General Motors (NYSE: GM) had a successful year in 2024, with a 9% increase in full-year revenue and leading the U.S. auto market in various delivery categories. The company also saw growth in market share and doubled its electric vehicle (EV) market share. By the end of 2024, GM’s EV portfolio became profitable. Looking ahead to 2025, GM’s decision to initiate share buybacks is a strategic move that may add value for investors.
GM responded to investor concerns about tariffs and losses from EVs by focusing on returning value to shareholders. The company announced a 25% increase in dividends and a new $6 billion share repurchase program. Mary Barra, chair and CEO of GM, emphasized the importance of capital allocation strategies that prioritize reinvesting in profitable growth, maintaining a strong balance sheet, and rewarding shareholders.
Share buybacks are a way for companies to increase earnings per remaining share by purchasing shares at market price. GM’s shares have been undervalued, with a modest price-to-earnings ratio of 7.4, even after a significant gain in 2024. The company has repurchased around $22 billion in shares since the end of 2023, contributing to its positive performance.
Despite potential challenges such as tariffs on imports, GM’s strong momentum from 2024 and positive developments in key markets like China indicate resilience and growth potential. The company’s focus on improving the profitability of its EV lineup and its commitment to returning value through buybacks make it an attractive investment option. Overall, GM stands out as a top automaker to consider for investment opportunities.
Do you ever regret missing out on investing in highly successful stocks? If so, you won’t want to miss this valuable opportunity. Occasionally, our team of expert analysts identifies companies with significant growth potential and issues a “Double Down” stock recommendation. If you’re concerned about having missed the ideal time to invest, now is the perfect moment to consider these opportunities. The results speak for themselves: investing $1,000 in Nvidia when we doubled down in 2009 would have yielded $292,207*, investing in Apple in 2008 would have resulted in $45,326*, and investing in Netflix in 2004 would have generated $480,568*. Currently, we are alerting investors to three exceptional companies with the “Double Down” recommendation, and the window of opportunity may not remain open for long. *Stock Advisor returns as of March 3, 2025. Daniel Miller holds positions in General Motors. The Motley Fool suggests General Motors and has a transparent disclosure policy.
