Our partner, XM, lets you access a free demo account to apply your knowledge.
No hidden costs, no tricks.
The global automotive industry is home to a large number of household names. One such globally recognized name is General Motors. As the largest automaker in the United States, General Motors has a long history of operations, as well as explosive growth and decline.
While not an automotive brand in its own right, General Motors is the parent company of some of the most famous car brands, such as Cadillac, GMC, Buick, and Chevrolet.
General Motors has emerged as one of the largest automakers in the world - generating well over $100 billion in annual revenues each year.
The company has been successful in its efforts to transition its lineup to electric vehicles and continues to operate in both consumer and luxury automobile segments, with a bulk of its sales coming from the United States and Canadian markets.
With the EV market set to reach over 60% of global car sales by 2030, General Motors is in a favorable position to take advantage of future growth, and investors might wish to buy up the stock at lower valuations.
If you are considering investing in General Motors stock, but don’t know where to start - this investfox guide is for you.
General Motors stock has grown massively since the start of the Covid-19 pandemic - nearly tripling in size over the course of two years. However, the past 12 months have seen an inconsistent performance from the stock, with wild upswings and downfalls being frequent.
The general instability in the global automotive market, due to ongoing supply chain constraints, high inflation, and curbed consumer spending, has had its effects on GM’s bottom line and stock performance. However, the company is still adamant about reaching its long-term goals and the stock has slowly regained its footing since the start of 2023.
With current valuations, still far below the all-time highs of 2021, General Motors has decent room for growth in the long run, as the company has plans to invest billions of dollars in bolstering its EV lineup - expecting to fully transition to electric vehicles by 2035.
In terms of financial performance, General Motors’ bottom line has seen major improvements over the past quarters, with Q4 2022 showing a substantial growth in revenues and earnings, despite the shrinking net profit margin:
The tightening of GM’s profit margin has been a symptom of increased materials costs and supply chain issues, which have been major problems faced by the global automotive industry. With solid revenue and earnings growth, General Motors solidifies its spot as one of the best options for investors to consider for their long-term portfolios.
GM has an annual dividend yield of 1.06%, which is modest when compared with some industry peers, such as Ford, which might not attract as many dividend investors to the stock as competitors.
Before investing in General Motors’ stock, investors should first consider the key advantages and disadvantages associated with the automotive industry, as well as GM in particular. Doing so can help investors consider multiple approaches to analyze GM stock and decide whether the company is the right choice for their portfolio.
General Motors is a relatively undervalued stock when compared to other major automakers on the market, which is why value investors might be particularly interested in investing in GM stock for the long term.
General Motors had its initial public offering on the New York Stock Exchange in 1916 and trades on the exchange under the GM ticker.
Yes. General Motors has a long history of dividend payments. As of April 2023, GM had an annual dividend yield of 1.06%, which is lower than some competitors, but still decent for a company of GM’s stature.