The General Motors story

What drives the business

• GM’s business centers on North American full-size trucks and SUVs while it invests in electric vehicles to address customer demand and fuel economy and emissions requirements.
• North America accounted for 83% of revenue in the quarter to June 2026, generating $39.9 billion, compared with international revenue of $3.7 billion and finance arm revenue of $4.3 billion.
• The EV transition includes Ultium Cells Holdings LLC, an equally owned joint venture with LG Energy Solution that provides battery cells for GM’s electric vehicles.
• GM Financial supports vehicle demand through customer leasing and financing and dealer lending, with EBT-adjusted falling to $605 million from $704 million in the quarter to June 2026.
• GM’s dependence on North America makes vehicle mix and regional margins central to earnings, even as its Chevrolet, GMC, Buick and Cadillac brands span gasoline-powered vehicles and EVs.

What the price assumes

At $80.64, the reverse DCF implies annual free cash flow after stock pay growth of -19.0% for ten years, using a 10.2% discount rate.

GM delivered 11.5% annual growth in that measure over the last 10 years, while the TenQ check sets a 7.8% bar by slowing that record halfway toward 4%.

That implied contraction contrasts with the cash growth record, but the 20.3% free cash flow yield sits alongside a 40.2x price to earnings ratio and a 1.1% net margin.

Value GM on your own assumptions

What could change the story

• Fleet sales reached 22.3% of total vehicle sales in the quarter to June 2026, versus 17.8% a year earlier, increasing the share of less profitable transactions.
• Over the last twelve months, revenue growth was -1.1% and profit growth was -59.2%, while the 1.0% operating margin left limited room to absorb additional costs.
• Total debt of $131.6 billion compares with $24.7 billion in cash and short-term investments, and GM fails TenQ’s liquidity and interest coverage checks, though much of its debt sits within GM Financial.
• GM Financial’s access to funding, loan performance and leased vehicle residual values affect its ability to support customers and dealers.
• EV profitability depends on customer acceptance, charging infrastructure, battery supplies and compliance costs, while further realignment charges could widen the gap between adjusted earnings and net income.

What to watch next

• GM raised full-year 2026 EBIT-adjusted guidance to $14.0 billion to $16.0 billion and adjusted automotive free cash flow guidance to $9.5 billion to $11.5 billion.
• The next releases will show whether automotive operating cash flow supports the adjusted improvement, after falling to $5,604 million from $7,057 million in the six months to June 2026, against full-year guidance of $15.4 billion to $19.4 billion.
• North America’s margin, fleet share and EV realignment adjustments will indicate whether stronger core earnings translate into net income, for which GM expects $8.4 billion to $9.8 billion in 2026.

Sources

• General Motors's earnings release, filed with the SEC
• Its latest 10-Q or 10-K, for the risk factors
• The GM stock report, for every figure and check