Does General Motors Stock’s Run Make Any Sense

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The worry with General Motors (GM) is that the stock has run ahead of the business. While GM stock returned 27.5% over the past year, compared with 11.3% for the S&P 500, its revenue over the four quarters to September 2026 was flat from a year earlier. GM stock rose from $76.31 on October 26 to $87.40 on October 30, after GM said on October 27 that it will move its share listing from the NYSE to Nasdaq. Profit has picked up, but GM shares have also fallen far harder than the market in most past shocks. So how much has GM's business actually changed?

GM's Profit Jumped In The Third Quarter Of 2026

GM earned $3.34 billion in the third quarter of 2026, up from $1.33 billion a year earlier. Revenue grew far less than profit did, so the gain came from keeping more of each sale. GM's operating margin was 7.2%, compared with 2.2% a year earlier, and the company has made a profit in each quarter of 2026 so far.

Can GM Keep Earning At This Pace?

GM's own past year shows how fast its profit can change: the company lost $3.31 billion in the fourth quarter of 2025. That loss is part of the twelve months behind the stock's price of 19.3 times earnings, compared with 22.6 for the S&P 500, so the multiple will shift as the loss drops out and newer quarters replace it. If a profit takes the place of that loss, trailing earnings rise, and at the same share price, the multiple falls.

GM also has little sales growth to fall back on. Its revenue grew an average of 2.9% a year over the past three years, compared with 6.1% for the S&P 500, and news reports on October 20 said auto sales are cooling.

Management does not share the worry that the stock has outrun the business. On October 20, the day GM reported, the board approved a new $20 billion share repurchase authorization. That authorization equals about 26% of GM's market value. News reports that day said GM executives believe the stock is fundamentally undervalued. Yet the same day, GM narrowed its full-year 2026 profit outlook, and the stock fell 6.8%.

How Far Has GM Stock Fallen In Past Shocks?

GM stock fell further than the S&P 500 in four of the last five market shocks. The deepest drop came in the 2022 inflation shock, when GM stock lost 50%, compared with 24% for the S&P 500. It fell 30% in the 2023 yield shock, against 9.5%. The 2025 tariff shock was the exception: GM fell 11%, less than the 19% fall in the S&P 500.

After this run, owning GM amounts to a bet that its profit stays nearer the third-quarter level than the swings of the past year. When the company reports its fourth quarter of 2026, GM's quarterly net income is the figure to watch, set against the loss in the same quarter a year earlier.

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