Latest Developments:
In 3Q24, General Motors (GM) posted $48.75 billion in revenue, a 10.48% increase year-on-year, but net income fell slightly by 0.26%. The growth was primarily driven by strong performance in GM North America, which saw a 14% increase in sales. However, GM's international sales, including from China, declined significantly. Margins showed slight deterioration with operating and net margins of 7.39% and 6.27%, respectively. The company repurchased $1 billion in stock, reducing its share count by 19%.

Investment Case:
GM is poised to benefit from the strong automotive market and continued demand for EVs. The company is expanding its EV portfolio and remains the second-largest EV player in the U.S. However, GM faces several challenges: rising labor costs due to a recent union deal, potential tariffs under President Trump's policies, and the risk of increased manufacturing costs. These factors may pressure GM's margins and shareholder returns.

Valuation:
Despite GM's share buybacks and strong revenue growth, its current price reflects the market's expectations. Valuation analysis, based on the company's projected earnings and share reduction, suggests a fair value of around $49.87 per share. With no immediate positive catalysts and looming risks, GM's price lacks a margin of safety for investors.

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