Key Stats for General Motors Stock
- Price Change for $GM stock: -2%
- Current Share Price: $54.63
- 52-Week High: $62
- $GM Stock Price Target: $64
What Happened?
General Motors (GM) stock dipped nearly 2% today after the company disclosed a $1.6 billion hit to third-quarter earnings related to its electric vehicle plans not playing out as expected.
The charge includes $1.2 billion in non-cash writedowns from adjustments to EV manufacturing capacity, plus $400 million in cash for contract cancellations and settlements tied to EV investments.
The timing is notable, as GM was among the first automakers to invest heavily in EVs, planning to spend $30 billion on electric vehicles by the end of this year, with dozens of new models and massive battery production capacity.
But the market didn’t develop as fast as anticipated, forcing a strategic reset. The writedown follows the Trump administration’s elimination of the $7,500 federal EV tax credit in late September and rollback of strict emissions regulations that had been pushing automakers toward 50% EV sales by 2030.
GM acknowledged in its filing that “following recent U.S. Government policy changes, we expect the adoption rate of EVs to slow.”
This isn’t unique to GM, given Ford took a similar $1.9 billion charge last year from scaling back EV plans, including canceling a three-row electric SUV and delaying its next-generation electric pickup truck.
Despite the writedown, GM is having a strong year in EVs operationally. The company sold 144,668 electric vehicles through September, capturing 13.8% of the U.S. EV market, up from 8.7% at the start of the year.
That makes GM the #2 EV seller behind Tesla and ahead of Hyundai, Ford, and others. The Chevrolet brand alone ranks as the #2 EV brand nationally, while Cadillac leads the luxury EV segment.
See analysts’ growth forecasts and price targets for GM stock (It’s free!) >>>
What the Market Is Telling Us About GM Stock
The market’s reaction reflects concern about near-term EV profitability, but investors seem to be missing GM’s broader strategic positioning.
CFO Paul Jacobson has been crystal clear that while this writedown stings, it doesn’t change the company’s underlying resilience or cash generation capability.
GM expects to generate $7.5 billion to $10 billion in free cash flow this year despite absorbing $4 billion to $5 billion in tariff costs and the $1.6 billion EV charge.
That’s remarkable when you consider GM is simultaneously paying down debt, buying back stock (retiring 30% of shares in the last 3 years), and investing $4 billion to reshore pickup and SUV production from Mexico.
The regulatory shift is net positive for GM’s overall business. While the loss of federal credits impacts EV profitability, the automaker was spending about $1 billion annually buying emissions credits from competitors to avoid penalties under the old regulatory framework.
Those penalties are being eliminated, allowing GM to retain the self-help initiatives already implemented to offset tariffs.
With net debt down to around $30 billion from $50 billion three years ago and a fortress balance sheet, GM stock has the financial flexibility to weather this transition while continuing to return capital to shareholders.
The free cash flow yield sits at 13%, suggesting the market still hasn’t fully appreciated the company’s transformation from the old cyclical GM to today’s disciplined, cash-generating machine.
Wall Street Analysts Are Bullish on These 5 Undervalued Compounders With Market-Beating Potential
TIKR just released a new free report on 5 compounders that appear undervalued, have beaten the market in the past, and could continue to outperform on a 1-5 year timeline based on analysts’ estimates.
Inside, you’ll get a breakdown of 5 high-quality businesses with:
- Strong revenue growth and durable competitive advantages
- Attractive valuations based on forward earnings and expected earnings growth
- Long-term upside potential backed by analyst forecasts and TIKR’s valuation models
These are the kinds of stocks that can deliver massive long-term returns, especially if you catch them while they’re still trading at a discount.
Whether you’re a long-term investor or just looking for great businesses trading below fair value, this report will help you zero in on high-upside opportunities.
Click here to sign up for TIKR and get our full report on 5 undervalued compounders completely free.
Looking for New Opportunities?
- See what stocks billionaire investors are buying so you can follow the smart money.
- Analyze stocks in as little as 5 minutes with TIKR’s all-in-one, easy-to-use platform.
- The more rocks you overturn… the more opportunities you’ll uncover. Search 100K+ global stocks, global top investor holdings, and more with TIKR.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
