1 Bargain Stock That I'm Buying Like There's No Tomorrow

In a market where fear often overshadows fundamentals, one stock stands out as a diamond in the rough: General Motors (GM). With a P/E ratio of just 7.21—nearly half the S&P 500’s average of ~18 as of late 2024—GM combines undervaluation with a powerhouse position in the electric vehicle (EV) revolution and robust financial health. This is the stock I’m buying aggressively today.

Why GM is Undervalued—and Why That Won’t Last Long

GM’s low P/E reflects lingering concerns about the transition costs of its EV shift, as well as broader economic uncertainties. Investors have been hesitant to reward the company’s progress in electrification, autonomous driving, and global market dominance. But this skepticism overlooks three critical facts:

1. Cash Reserves: GM boasts $37 billion in cash and equivalents (as of Q3 2024), a war chest to weather volatility and fuel innovation.
2. Operational Strength: The company’s net free cash flow has grown steadily, reaching $13.8 billion in 2023, even amid supply chain disruptions.
3. EV Leadership: GM’s Ultium platform—its modular EV architecture—has already produced hits like the Hummer EV and GMC Sierra EV, while its partnership with Honda and investments in Cruise (self-driving tech) signal a future-proof strategy.

The EV Gold Rush: GM’s Unmatched Position

The global shift to EVs is no longer a distant promise—it’s happening now. By 2030, EVs are projected to account for 30% of new car sales globally, per BloombergNEF. GM is not just keeping pace but leading the charge:

• Market Share: GM holds a 13% slice of the U.S. EV market, second only to Tesla.
• Scalability: The Ultium platform allows GM to produce 25+ EV models by 2025, leveraging its existing dealer network and brand loyalty.
• Global Reach: Unlike Tesla, GM’s sales extend to 40+ countries, including high-growth markets like China and Europe.

Financial Resilience: A Foundation for Growth

Beyond its EV ambitions, GM’s balance sheet is a fortress:
- Debt-to-Equity Ratio: A conservative 0.43, well below the auto industry average of ~0.7.
- Profitability: Gross margins hit 11.5% in Q3 2024, up from 9.8% in 2022, as cost efficiencies take hold.
- Dividend Sustainability: A $1.20 annual dividend (yielding ~2.5% at current prices) is safe given its cash flow.

The company’s focus on cost discipline—evident in its $28 billion EV investment plan versus Tesla’s $70 billion—ensures it can grow without overextending.

Risks? Yes. But They’re Overblown.

Critics cite risks like supply chain volatility and regulatory hurdles. Yet GM’s partnerships with suppliers like LG Energy Solution (for batteries) and its $7.5 billion investment in U.S. EV factories signal proactive risk management. Meanwhile, its $10 billion R&D budget ensures it stays ahead of competitors in tech like autonomous driving.

A Final Look at the Numbers

• P/E Multiple: 7.21 vs. the S&P 500’s ~18.
• EV-to-Sales Ratio: 0.4x, far below Tesla’s 2.3x.
• Long-Term Growth: Analysts project a 15% CAGR in EV revenue through 2030.

Conclusion: The Time to Buy GM is Now

General Motors is a rare blend of value and growth, trading at a discount that ignores its EV leadership, financial strength, and global scale. With a P/E ratio that’s half the market’s and cash reserves to fuel its transformation, this stock is poised to rebound sharply as EV adoption accelerates.

The catalysts are clear: rising EV sales, improving margins, and share buybacks (GM plans $5 billion in repurchases by 2025). For investors seeking a bargain with a margin of safety, GM is the top pick—no question, no hesitation.

Act now—before the market catches up.