1. General Motors Company (NYSE:GM)
Number of Hedge Fund Holders as of Q3: 64
Greenhaven Associates’ Equity Stake: $1.26 Billion
General Motors Company (NYSE:GM) is the largest holding in Ed Wachenheim’s stock portfolio, operating as an automotive manufacturing company. Greenhaven Associates held over 23.72 million shares of the company as of Q4 2024 which constitutes 18.69% of the portfolio.
A leader in the automobile industry for over a century, General Motors Company (NYSE:GM) manufactures vehicles under world-famous brands such as Chevrolet, Buick, GMC, and Cadillac, along with Wuling and Baojun in China. The company operates through multiple joint ventures worldwide, including partnerships in China, India, Egypt, and South Africa. GM also owns OnStar, which provides in-vehicle communication and security services, and GM Financial, its auto financing subsidiary that operates in North America, Latin America, and China. General Motors Company (NYSE:GM) revenue streams primarily include vehicle sales, financing services through GM Financial, and its subscription-based offering known as OnStar, making it a diversified leader in the global automotive industry.
General Motors Company (NYSE:GM)’s revenue of $47.70 billion for the quarter ended December 2024 indicated solid business growth, especially as it demonstrates an increase of 11% year-over-year. The earnings per share (EPS) for Q3 2024 were $1.92, which exceeded analyst estimates of $1.84 by $0.08.
The company faced a challenging fourth quarter, largely due to significant losses from its Chinese joint ventures, resulting in a $5 billion restructuring charge and asset write-downs. Increased competition from domestic automakers like BYD, coupled with Chinese government subsidies supporting local manufacturers, has made the market more difficult for foreign brands.
Despite these setbacks, CEO Mary Barra emphasized the company’s progress in expanding its electric vehicle market share and restructuring efforts to improve its Chinese operations. Additionally, General Motors Company (NYSE:GM) announced plans to refocus its autonomous driving business, shutting down its costly robotaxi program to achieve $1 billion in annual savings. However, uncertainty surrounding U.S. trade, tax, and environmental policies has added further challenges, requiring proactive engagement with policymakers. While the company is committed to long-term growth, these financial letdowns have had a significant impact on its recent performance.
Hotchkis & Wiley Large Cap Value Fund stated the following regarding General Motors Company (NYSE:GM) in its Q3 2024 investor letter:
“General Motors Company (NYSE:GM) is one of the world’s largest manufacturers of passenger vehicles. GM reported a strong Q2; however, management provided a cautious outlook for the second half of 2024. Comments from GM mirrored those of other OEMs and auto suppliers, leading investors to believe the automotive cycle has peaked. We believe this is an overreaction, and we continue to view GM as an attractive investment. We like GM for many reasons. First, we believe GM has leading market positions in its main business segments. Second, the valuation is extremely attractive. Finally, it is a strong free cash flow generator, and the management team is committed to repurchasing their undervalued shares.”
Overall General Motors Company (NYSE:GM) ranks first on our list of Greenhaven Associates’ top 10 stocks to invest in. While we acknowledge the potential for GM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than GM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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