GM Unveils $20 Billion Buyback as Shares Drop 6.78%

General Motors Co. (NYSE: GM ) gave investors almost everything they wanted on Tuesday: an earnings beat, revenue beat, increased cash flow guidance and a board-approved $20 billion share buyback. Yet the stock is heading for its worst day in 15 months, with shares down 6.8% to $77.15 in premarket trading. A close at that level would mark the steepest one-day drop since July 22, 2025, when the stock lost 8.1%. GM Third-Quarter Earnings Beat On Nearly Every Line Adjusted earnings per share came in at $3.70, above the $3.56 estimate. Revenue rose 2.9% year over year to $50.02 billion, ahead of the $48.53 billion consensus. North America did the heavy lifting. Adjusted EBIT, or earnings before interest and taxes stripped of one-off items, reached $3.59 billion in the region, as margins widened to 8.7% from 6.2% a year ago. GM posted its best third-quarter full-size pickup sales ever. Read Also: Are Companies Reducing AI Spending? Chip Orders Say Otherwise Why is GM Stock Falling? Check the Full-Year Outlook GM narrowed its 2026 adjusted EBIT guidance to $14.5 billion to $15.5 billion, from $14 billion to $16 billion. The midpoint stayed at $15 billion. In other words, a quarter that beat expectations did not lift the annual profit forecast. Costs are part of the reason. GM now expects about $2 billion in commodity inflation, including logistics and memory chips, compared with up to $2 billion previously. GM International, the unit that covers markets outside North America, was the weak spot. Its adjusted EBIT came in at just $28 million, against an estimate of $130.4 million. Meanwhile, U.S. deliveries fell 5.5% to about 671,000 units, and market share slipped to 16.1% from 16.8%, according to the company’s earnings presentation. A $20 Billion Buyback Worth About 30% Of GM The new authorization follows the completion of a $6 billion program. Shares outstanding have already fallen to 849 million from 904 million at the end of 2025. At Tuesday’s premarket price, GM is worth about $65 billion. As a result, the buyback equals roughly 30% of the company. The cash is there. Adjusted automotive free cash flow rose 40% to $5.88 billion in the quarter, and GM raised its full-year target to $11.5 billion-$12.5 billion (up from the previous $9.5 billion to $11.5 billion range). However, a buyback changes how profit is divided, not how much profit there is. Investors on Tuesday are focused on the second part. Expectations were also high. GM shares had gained 43% over the past 12 months through Monday and hit a record $91.85 earlier this year. The premarket price leaves the stock 16% below that peak and about 5% lower for the year. Read Also: Stock Market Today: Nasdaq 100 Rises as AI Chip Rout Reverses, SanDisk Jumps 7% What Wall Street Analysts Think Of GM Stock GM carries a Buy consensus rating from 21 analysts tracked Analyst Ratings, with an average price target of $97. That implies about 26% upside from the premarket price. No firm had moved on the stock a