General Motors, with a market cap of $73 billion, raised its dividend by 20% and announced a $6 billion buyback program after beating Q4 earnings forecasts. The company’s stock surged nearly 70% over the past year, rewarding investors through aggressive restructuring.
GM’s quarterly dividend is now $0.18 per share, with an annual payout of $0.72 per share. Analysts forecast a free cash flow of $10.51 billion in 2026, indicating room for further dividend increases and debt reduction.
Projected to increase its annual dividend per share to $0.96 by 2029, GM’s aggressive share buyback program has reduced shares by 35%, improving per-share metrics. The company believes its shares are undervalued despite recent gains.
GM posted adjusted earnings of $2.51 per share in Q4, surpassing analyst expectations. Revenue slightly missed projections at $45.3 billion, but the focus is on its 2026 guidance of $11-$13 per share and a return to target profit margins in North America.
CEO Mary Barra highlighted GM’s strength in North America, maintaining a 60% share in full-size SUVs. The company sold over 700,000 vehicles under $30,000 in 2025, showcasing profitability at lower price points and new battery technologies to enhance profitability.
Despite absorbing $7.6 billion in charges for EV-related assets, GM isn’t giving up on EVs but adjusting capacity to meet demand. The company added nearly 100,000 new EV customers in 2025 and plans to leverage new technologies to improve profitability.
GM’s cash generation has significantly increased over the past five years, funding both dividend increases and share buybacks. Tariffs remain a challenge, but the company has managed them better than expected and plans to offset costs through manufacturing moves.
Looking ahead, GM expects another $3-$4 billion in tariff-related expenses in 2026. The company is actively working to mitigate these costs and aims to produce nearly 2 million vehicles annually in the U.S. by 2027, focusing on what works best for profitability.
Read more at Yahoo Finance: Iconic car maker raises dividend by 20% after record profit