General Motors Company (GM): Does this Feminist Stock Remain Well-positioned Despite the Setbacks?

We recently compiled a list of the 11 Best Feminist Stocks To Invest In. In this article, we are going to take a look at where General Motors Company (NYSE:GM) stands against the other feminist stocks.

With the passage of time, the role of women in the modern day workplace has slowly started to grow. In less than a century, more women not only lead companies but are also among some of the wealthiest individuals in the world. At the same time, women have demonstrated that they are equal to men when it comes to disrupting industries. One of the best examples of this phenomena is America’s best known rocket company SpaceX. While SpaceX is famous for its founder and billionaire Elon Musk, the firm’s chief operations officer and president Gwynne Shotwell has been equally responsible for its massive success in the rocket industry which has dislodged decades of monopolies held by a few defense contractors.

In fact, this rising trend of women leading the charge at some of the biggest companies in the world has also generated interesting statistics when it comes to compensation. Data from Equilar shows that in 2023, out of the 341 CEOs part of the study, 25 were women. Their median pay package stood at $17.6 million, which according to Equilar, was 7.7% higher than the figure for the complete data set. At the same time, the 25 female CEOs saw five new executives added to the list when compared to 2022.

Considering this, it would appear that the gender pay gap in the US appears to be narrowing. To confirm this, we’ll have to look at the pay statistics for the entire country as opposed to only S&P 500 CEOs. Well, on this front, data gathered by Pew shows that there’s a lot to be done. The research firm points out that in 2002, women earned 80% of what men were paid. Two decades later, i.e. in 2022, this stood at 82%, indicating that there’s a lot more to be done to decrease the wage gap between the two genders. However, at the same time, younger women might be changing these trends. This is because according to Pew, women aged between 25 and 34 earned 92% of their male counterparts, which is quite higher than the figure of 86% in 2002.

With these details in mind, we decided to take a look at the best feminist stocks to invest in.

Our Methodology

To make our list of the best feminist stocks to invest in, we ranked publicly traded Fortune 500 companies with female CEOs by the number of hedge funds that had bought the shares in Q1 2024. Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

A group of technicians in a garage, inspecting car parts and ensuring safety compliance.

General Motors Company (NYSE:GM)

Number of Hedge Fund Shareholders In Q1 2024: 78

CEO: Mary T. Barra

General Motors Company (NYSE:GM) is one of the oldest and most iconic car manufacturers in America. Amidst a tumultuous couple of months which have seen General Motors Company (NYSE:GM) resume its autonomous driving efforts and settle disputes with unions for a battery manufacturing facility. Citi kept its Buy rating for the shares and a $96 share price target in June 2024. The two key reasons behind the sustained optimism even as General Motors Company (NYSE:GM) has struggled in the EV industry are Citi’s belief that the US auto industry is robust and the car maker’s $11 billion share buyback. Between Q2 2024 and 2025, Citi now expects $7.1 billion in share buybacks which is significantly higher than the earlier estimate of $6.3 billion in buybacks.

General Motors Company (NYSE:GM)’s forward price to earnings ratio is just 5.02, which is less than 4x the S&P 500’s reading. This shouldn’t fool you though. We remember David Einhorn pitching GM at an investment conference more than 10 years ago and telling investors that GM’s PE ratio is 8 and it is an extremely cheap stock. If GM’s true PE ratio was really 8 and the company was managed by talented individuals, they would have bought back enough shares to buy 1.5 GMs in 12 years. GM is still an “extremely” cheap company after 12 years and it underperformed the market S&P 500 Index during this period. GM’s market cap is around $50 billion, but it also has nearly $100 billion in net debt. It is a risky stock with a bankruptcy in its history. Unless General Motors’ management demonstrates a clear commitment to prioritizing shareholder interests over those of employees, we remain cautious about the GM stock.

Diamond Hill Capital mentioned the firm in its Q1 2024 investor letter. Here is what the firm said:

Automobile manufacturer General Motors continues capitalizing on the shift to electric vehicles (EVs) while maintaining the strength of its core gas-engine truck and SUV business. Though it has experienced some setbacks — such as needing to roll back its Cruise driverless car project — we believe the company remains well-positioned relative to secular tailwinds within the automobile business.

Overall PH ranks 5th on our list of the best feminist stocks to buy. You can visit 11 Best Feminist Stocks To Invest In to see the other feminist stocks that are on hedge funds' radar. While we acknowledge the potential of GM as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. 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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Disclosure: None. This article is originally published at Insider Monkey.