Shareholders in General Motors got good news today when the GM Board of Directors announced two financial actions that will increase the value of their investment, including a boost to dividends and a share repurchase program.
GM is using its significant recent profits to increase dividends by 3 cents per share, which amounts to a 25-percent quarterly rise in the dividend rate of its common stock. The General will now pay $0.15 per share rather than $0.12, starting in April 2025.
Additionally, the Board has earmarked $6 billion for a new share repurchase program, with $2 billion of the buyback to be carried out on a boosted timetable. The accelerated share repurchase (ASR) plan will see the $2 billion buyback take place during the first six months of 2025, with the other $4 billion to occur at a later, as yet unspecified date.
A share repurchase program helps shareholders by reducing the amount of stock, increasing the stake and value offered by the remaining shares. GM CEO Mary Barra stated that “GM team’s execution continues to be strong across all three pillars of our capital allocation strategy, which are to reinvest in the business for profitable growth, maintain a strong investment grade balance sheet, and return capital to our shareholders.”
Previous share repurchases include a $5 billion buyback in 2015, followed by a $10 billion repurchase and dividend increase announced in late 2023. The latter buyback sent GM share prices higher by almost 12 percent in a single day of trading. A third repurchase program of $6 billion was authorized in June 2024.
On the dividend front, GM declared its first-quarter 2025 dividend of $0.12 per share to be payable on March 20th, 2025 to all common shareholders of record. This followed similar dividends for the Q4 of 2024, Q3 of 2024, Q2 of 2024, and Q1 of 2024, while the previous $0.09 dividend was paid during Q4 2023.
Mary Barra also took the opportunity to note that “we are investing our capital in a disciplined and consistent way to continue generating strong margins and cash flows.”
She added that these beneficial financial actions are made possible because “we are growing our business thanks to our broad, deep, and compelling portfolio of ICE vehicles and EVs.”
Comments
Wonderful. Instead of spending $6 billion on badly needed product, lets spend it instead on artificially propping up our share price to mask our incompetence.
Mary’s getting desperate about keeping her job. Watch Ford do this next. It won’t work.
What product is badly needed? Low or no margin sedans in a dying market segment?
Hybrids in any NA segment to start.
Anything besides another boring EV crossover 🙄
But that’s what Karen, sorry, Mary Barra loves!
A new manual transmission Chevrolet Camaro
Ford Bronco competitor, Ford Maverick competitor, baby Hummer EV.
how about a dependable V8 engine ……
Why did GM Authority erase to comments for the Tariff Article? They post these political articles and get rid of the comments? So much for freedom of speech.
must be related to yahoo censorship committee
More stock buybacks. Maybe cut your prices and stop being so greedy. You could also invest in future proofing the company before the Chinese eat you alive with much better tech and features in their vehicles.
Are you a Capitalist or a Socialist? Most auto manufacturers including GM have very modest profit margins. If they cut their prices much they would become a non-profit.
Good use of capital when the market is undervaluing your company. GM and Barra once again prove they have the best management team in the auto business. Compare this to the continued bad news out of Stellantis today and it is even more apparent how well GM is managed compared to their US competitors.
Stellantis is suffering mainly from the decisions of their WEF, European, wimpy former CEO. Good for gm that they still have truck/SUV customers.
I’m sure it’ll boost the stock price for a day or two
how about spending $6B on building products–starting with my SR corvette that I ordered in November of 24 ?
Customers are waiting months for parts and the best GM can do is a stock buyback? Invest in the company, not the shareholders.
The shareholders are the company, the American education system really sucks.
Certainly the pass / fail testing process need work….
The shareholders are definitely NOT the company. Most of them don’t even work there. They’re investors.
James Robert,
Shareholders own the company therefore they are the company.