-GM’s Profit-Balancing Strategy Fuels Investor Gains Amid Trump Politics
- Mary Barra, CEO of General Motors, attends the annual Allen and Co.
- DETROIT - General Motors is proving to be a star tightrope walker when it comes to balancing its profits, vehicle portfolio and political whiplashing under the Trump management.
- The Detroit automaker's 2025 results propelled GM's stock Tuesday to a fresh record high as the company beat earnings expectations and projected an even better 2026, including a...
Mary Barra, CEO of General Motors, attends the annual Allen and Co. Sun Valley Media and Technology Conference at the Sun Valley Resort in Sun Valley, Idaho, on July 8, 2025.
David A. Grogan | CNBC
DETROIT – General Motors is proving to be a star tightrope walker when it comes to balancing its profits, vehicle portfolio and political whiplashing under the Trump management.
The Detroit automaker’s 2025 results propelled GM’s stock Tuesday to a fresh record high as the company beat earnings expectations and projected an even better 2026, including a 20% increase in its dividend and a new $6 billion stock buyback authorization.
Those kinds of results are nothing new for GM, but Wall Street analysts say the company is drawing more investor interest than its peers amid the U.S. auto industry’s slowing sales, political turmoil and tariffs.
“GM stands out for strong execution, proven resilience, high earnings quality (i.e. strong [free cash flow] amid inventory de-stock), capital allocation and a unique NA Truck Franchise sporting far better fundamentals vs. traditional passenger auto,” TD Cowen analyst Itay Michaeli wrote in a Tuesday investor note.
Shares of GM are up more than 70% during the past year,with multiple Wall Street analysts raising their price targets to record levels after earnings,including TD Cowen,which hiked its target Tuesday by 10% to $122 per share.
GM is also increasingly standing out from its closest U.S. rivals Ford Motor.
GM Navigates Political and Economic Headwinds While Automakers Face Stock Declines
Shares of General Motors, Ford, and Stellantis have experienced varied performance over the past year, as the automotive industry grapples with tariffs, inflation, and shifting political landscapes. U.S.-listed shares of Stellantis have fallen approximately 27% over the last year, following disappointing financial results as the company attempts a U.S. turnaround.
GM reported $2.7 billion in net income attributable to stockholders for 2025, translating to $3.27 earnings per share. Adjusted earnings before interest and taxes reached $12.7 billion, or $10.60 per share, with adjusted automotive free cash flow at $10.6 billion.
Political Uncertainty and Cost Management
GM’s relative success has been partly attributed to its ability to manage through political uncertainty under U.S. President Donald Trump. The automotive industry as a whole faces increased costs from tariffs and inflation. GM anticipates tariffs will cost the company $3.5 billion and inflation $1.25 billion in 2026.
However,GM plans to offset these costs. The automaker projects $500 million to $750 million in regulatory savings due to Trump administration policies, reduced losses from electric vehicle production-estimated between $1 billion and $1.5 billion due to lower production volumes-and additional savings from pricing and warranty expenses.
“For ’26, commodity and onshoring headwinds could be offset by regulatory benefits, warranty improvements, narrowing EV losses, and lower tariffs resulting from USMCA negotiations,” said Tom Narayan, an analyst at RBC Capital, in a note to investors on Tuesday.
GM, Ford and Stellantis stocks