QS Research · Michael Burry's Scion Capital analyst template · 2006
General Motors Co (GM)
As of 2026-11-11 · 11/15 boxes filled from SEC filings and market data
Report price $88.69 (close 2026-11-10)
Conclusion: PASS
Conviction low · base case -55% · downside -75% · upside +37%
GM is not a broken business, but it is a low-return one: TTM revenue of $186.95B is the highest in the six fiscal years shown while operating income is only $4.34B (2.3% margin), ROIC is 2.4% against a 6.1% WACC (N46, N47, N48), and net debt is $103.77B at 6.4x GAAP EBITDA (N23, N56). The apparent cheapness is an earnings-quality artifact: GAAP P/E is 19.3x on $3.88B net income to common, but adjusted P/E is 6.3x on $11.95B after adding back $6.56B of restructuring and $1.51B of impairments (N36, N37, N38). The code's independent base case is the peer-median 8.6x P/E on GAAP earnings, which gives $39.52, -55.4% (N66); the downside is -74.8% and the upside at 8.6x on adjusted earnings is +37.0%, so reward/risk is 0.49:1 and the rule is not met. I would watch, not buy: the $20.0B buyback authorization (2026-10-25) and the raised FY2026 adjusted automotive FCF guide of $11.5-12.5B (2026-10-20) are real, but they do not fix a 2.4% ROIC or a 0.7x EBIT/interest coverage (N53).
Key numbers
- Share price: $88.69
- Market cap: $74.81B
- Latest financial period: TTM to Sep 30, 2026
- Revenue (TTM): $186.95B
- EV / EBITDA (TTM): 10.9x
- P/E (TTM): 19.3x
- FCF yield: 19.2%
- Price / book: 1.19x
- Earnings-quality flags (TTM): Impairments -$1.51B (39% of net income); Restructuring charges -$6.56B (169% of net income)
- P/E, adjusted (TTM): 6.3x
- EV / FCF (TTM): 12.4x
- Revenue growth (latest fiscal year): -2.1%
- ROIC (TTM): 2.4%
- WACC: 6.1%
- Economic profit spread: -3.7 pts
The 15 boxes
- ✓ 1. Long-form business notes
GM's FY2020 10-K shows a vehicle manufacturer and retail-finance model: GMNA and GMI wholesale vehicles, Cruise AV, GM Financial, dealer and fleet channels, with Europe exited in 2017 and an all-electric transition underway. XBRL data show revenue of $108.67B in FY2020, $167.97B in FY2025 and $186.95B TTM to Sep 30 2026, while operating income was $2.91B in FY2025 and $4.34B TTM and operating cash flow was $26.87B in FY2025 and $23.41B TTM. The latest 10-K excerpt is risk-focused, covering regulatory and EV compliance, litigation, recalls, tax, GM Financial, pensions and cybersecurity; the provided sources do not give FY2025 segment volume or per-unit economics.
- ○ 2. Competitive advantage
There is no durable pricing advantage visible in the numbers: revenue of $186.95B TTM to 2026-09-30 is the highest in the six fiscal years shown, but operating income is only $4.34B TTM and fell to $2.91B in FY2025 from $12.78B in FY2024, so scale did not convert into margin. What GM does have is a concentrated US franchise (US truck share 33.0% in 2025 vs 30.7% in 2023), 50 US plants including 11 assembly plants and 4,566 GMNA dealers — offset by share losses in China and South America. The company's own risk factors describe a highly competitive industry whose capacity has 'historically far exceeded demand', and TTM operating income of $4.34B is smaller than the $12.00B D&A charge.
- ✓ 3. 10-Q takeaways
Q3 2026 (quarter ended September 30, 2026, 10-Q filed October 20, 2026) was a revenue-and-margin-up quarter: revenue $50,015M (+2.9%), EBIT-adjusted $4,106M and EBIT-adjusted margin 8.2% vs 6.9%, with GMNA carrying the quarter at 8.7% margin while GMI collapsed to $28M EBIT-adjusted. Cost favorability came from lower warranty ($0.9B) and lower EV inventory write-downs ($0.4B), not from pricing (Q3 GMNA price variance was negative). FY2026 guidance was narrowed upward at the midpoint for EBIT-adjusted, adjusted automotive free cash flow and EPS-diluted-adjusted, and the Board added a new $20.0B repurchase authorization while the $6.0B January 2026 program was completed.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ○ 11. Impression of the shareholder letter
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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