General Motors Rewards Shareholders with a 25% Dividend Hike and $6 Billion Buyback Plan
General Motors (GM) has announced a substantial 25% increase in its dividend, raising it from 12 cents to 15 cents per share. The updated payout will take effect with GM’s next scheduled dividend announcement in April 2025.
Additionally, the company is launching a $6 billion share buyback program, beginning with a $2 billion accelerated share repurchase, which is expected to conclude by the second quarter of 2025. The remaining $4.3 billion will be allocated for future buybacks, reinforcing GM’s commitment to returning value to investors.
GM’s financial strength underpins these moves. The automaker generated $14 billion in adjusted automotive free cash flow last year and distributed $7.6 billion to shareholders through dividends and stock repurchases. GM successfully met its target of reducing outstanding shares below 1 billion, closing 2024 with 995 million shares. With $35.5 billion in total automotive liquidity, including $21.7 billion in cash, GM’s balance sheet remains solid. GM currently holds a Zacks Rank #2 (Buy).
Advance Auto Parts Narrows Losses But Faces Ongoing Challenges
Advance Auto Parts (AAP) reported an adjusted loss of $1.18 per share for Q4 2024, beating the Zacks Consensus Estimate of a $1.38 loss. This was still a wider loss compared to the prior year’s adjusted loss of 59 cents per share. However, the company’s revenue of $2 billion exceeded the estimated $1.93 billion.
Comparable store sales declined 0.9% year over year, a smaller decline than the projected 2% decrease. Advance Auto forecasts 2025 net sales in the range of $8.4-$8.6 billion and plans to open 30 new stores throughout the year. Comparable store sales growth is projected between 0.5%-1.5%, with an expected adjusted operating income margin of 2-3%. By 2027, the company aims to reach $9 billion in net sales and expand its store count by 50-70 locations.
Standard Motor Outperforms Expectations and Raises Dividend
Standard Motor (SMP) delivered strong Q4 2024 results, posting an adjusted EPS of 47 cents, exceeding the Zacks Consensus Estimate of 37 cents and improving from 37 cents in the prior-year quarter. Revenue climbed to $343 million, surpassing estimates of $297 million and significantly higher than the $291 million recorded in Q4 2023.
Despite a rise in gross profit to $101 million from $81.5 million, operating income declined to $3.9 million from $9.9 million in the prior-year quarter. The company’s cash reserves increased to $44.4 million as of Dec. 31, 2024, up from $32.5 million a year earlier. However, long-term debt surged to $535.2 million from $151.2 million.
Standard Motor also rewarded shareholders by hiking its quarterly dividend by 6.9% to 31 cents per share, which was paid out on Feb. 14, 2025. Looking ahead, the company expects sales growth in the mid-teens for 2025, with adjusted EBITDA projected at 10-11% of total revenue.
