Honestly, if you’d told most investors two years ago that General Motors would be sitting near a 52-week high in early 2026, they’d have laughed you out of the room. Back then, the narrative was simple: GM was "falling behind" in the EV race, and Tesla was going to eat everyone’s lunch. But look at the ticker today. GM stock price is hovering around $81, a massive climb from where it sat just a year ago.
How did a "legacy" company pull this off? It wasn't by being the fastest at building electric cars. Paradoxically, it was by admitting that building them is currently a massive money pit. In the last few weeks, the company dropped a bombshell: they’re taking over $7 billion in special charges for 2025. Most of that is tied to "right-sizing" their EV dreams.
The $7 Billion "Oops" That Wall Street Loved
It sounds counterintuitive. Why would a stock rally after announcing billions in losses? Basically, it’s about the "pivot." GM spent much of late 2025 and the start of 2026 showing they are no longer chasing EV volume at the expense of their actual bank account.
Of that $7.1 billion charge, about $6 billion is strictly for North American operations. They basically stopped trying to force the Orion Assembly plant to be an EV hub and shifted it back to what actually pays the bills: big SUVs and trucks.
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Investors aren't stupid. They see that the Chevrolet Silverado and GMC Sierra are absolute cash cows. GM led the U.S. industry in sales for 2025, up 6% for the year. When CFO Paul Jacobson recently told analysts that "2026 will be even better than 2025," he wasn't talking about selling a million Ultium bolts. He was talking about the 8% to 10% profit margins they’re squeezing out of gas-powered Suburbans while their competitors are still bleeding out in the EV lanes.
Analysts are actually feeling "silly"
Alexander Potter over at Piper Sandler recently upgraded the stock to a price target of $98. He even joked that he felt a bit "silly" upgrading it after such a massive run, but the math is hard to ignore. When you look at the price-to-earnings (P/E) ratio, GM is trading around 16x. Compare that to the broader market or even some of the tech-adjacent auto plays, and it still looks cheap.
The sentiment has shifted from "Can they survive the transition?" to "Look how much cash they're throwing at shareholders."
The Buyback Machine Is Humming
If you want to know why the stock price for GM is resilient despite a shaky global economy, look at the share count. Over the last couple of years, GM has been cannibalizing its own stock in the best way possible.
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- They announced a new $6 billion share repurchase authorization in February 2025.
- They’ve already retired hundreds of millions of shares.
- By shrinking the "pie," each remaining share becomes more valuable.
This isn't just financial engineering; it's a signal. Mary Barra is basically telling the market, "We think our stock is the best thing we can buy right now." When a company with $10 billion to $11 billion in annual free cash flow starts aggressive buybacks, the "floor" for the stock price tends to move up.
What Most People Get Wrong About "Eyes-Off" Driving
There’s another sleeper hit in the GM portfolio that doesn't get enough credit: Super Cruise. While everyone was watching Cruise (the robotaxi arm) go through its growing pains and restructuring, the consumer-facing tech was quietly winning.
In late 2025, GM revealed they’ve mapped 600,000 miles of hands-free roads. They’re aiming for "eyes-off" Level 3 autonomy by 2028, starting with the Cadillac Escalade IQ. Unlike Tesla’s camera-only approach, GM is sticking to its guns with a multi-sensor suite involving Lidar.
Why does this matter for the stock? High-margin software subscriptions. If you can sell a $130,000 SUV and then charge a monthly fee for the privilege of not looking at the road, your "legacy" car company starts looking a lot like a high-margin tech company. That’s the "multiple expansion" investors are betting on for the 2026–2028 window.
The Risks: It’s Not All Clear Skies
No expert would tell you this is a risk-free bet. The 2026 outlook from groups like Cox Automotive suggests a slight slowdown in total new-vehicle sales—maybe down to 15.8 million units across the industry.
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- Tariff Headwinds: Trade policies remain a wild card. GM has managed to mitigate some of this, but a sudden shift in import/export costs could shave billions off the bottom line.
- China Restructuring: The $1.1 billion charge for the SAIC-GM joint venture shows how tough that market has become. Domestic Chinese brands are winning, and GM is effectively retreating to a more "premium" niche there.
- The Debt Load: With a debt-to-equity ratio around 2, they aren't exactly "light" on the balance sheet. They need that truck cash to keep flowing to service the debt and fund the 2026 dividends.
Actionable Insights for the "GM Curious"
If you're watching the stock price for GM and trying to figure out if you missed the boat, keep an eye on these specific triggers:
- Watch the 8% Margin: If North American margins dip below this in the next quarterly report, the "pivot" story loses its teeth.
- Monitor the Share Count: Look for the "weighted average shares outstanding" in the 10-K filings. If that number keeps dropping, the EPS (earnings per share) will likely stay strong even if revenue is flat.
- The "Lidar" Debut: Any news on the cost or supplier of the Level 3 Lidar for the Escalade IQ will tell us a lot about whether their 2028 autonomy goals are realistic or just PR.
Basically, GM has stopped trying to be the "next Tesla" and started being the "best GM." For the stock price, that's made all the difference. The market is finally rewarding them for being a boring, cash-generating machine rather than a speculative tech play.
Next Steps for Investors: Check the upcoming Q4 earnings call transcripts specifically for "fixed cost reductions" and "warranty cost updates." These are the unglamorous levers Paul Jacobson mentioned that could drive the stock toward that $98 target analysts are whispering about.