GM Increases 2026 Dividend 20%; Buybacks and U.S. Production Drive Outperformance

GM (GM) announced a 20% increase in its 2026 dividend, reinforcing its commitment to returning capital to shareholders. The stock has more than doubled in two years, outperforming Ford (F) and Stellantis (STLA) amid broader auto-sector headwinds. For 2026, GM expects adjusted pre-tax earnings of $13B–$15B, up $2.3B from 2025; NA adjusted pre-tax margins to return to 8%–10%; and free cash flows of $9B–$11B. Since November 2023, the company has repurchased $23B in shares, reducing outstanding shares by 35%, and added a $6B buyback program. Management raised U.S. production capacity to mitigate tariff exposure and boost per-share earnings. The dividend yield is now about 0.90%, and sell-side mean target price is $91.24, up 13% from current levels. Analysts upgraded the stock in December 2025, with Piper Sandler and Morgan Stanley increasing price targets. With a forward P/E of 6.73x, the company’s disciplined capital allocation and strong free cash flow position it well for 2026.