General Motors Co. (NYSE:GM)

Return on Assets (ROA)

The Return on Assets shows an absence of data until the quarter ending December 31, 2020, where it begins at 2.73%. From that point, ROA rises steadily, peaking at 5.27% in the quarter ending September 30, 2021. Following this peak, a decline is observed through the next few quarters, reaching a low of 3.47% at September 30, 2022. Subsequently, the ROA experiences a mild recovery, hovering around 3.7% through 2023 and into early 2024. However, starting from the first quarter of 2025, a notable decline is evident, with ROA falling steadily from 2.15% to 1.65% by June 30, 2025.

Financial Leverage

Financial leverage shows a decreasing trend from the first quarter of 2020 through December 31, 2021, moving from 6.15 to 4.10. This indicates a gradual reduction in leverage during this period. In 2022 and into early 2023, the leverage ratio remains relatively stable, fluctuating narrowly between approximately 3.82 and 3.99. In the second half of 2023, a slight increasing trend emerges, peaking at 4.25 in December 31, 2023. Subsequently, leverage stabilizes again around 4.1 to 4.4 through mid-2025, indicating a moderate increase relative to the previous low points but remaining below the levels observed in early 2020.

Return on Equity (ROE)

Return on Equity begins in the quarter ending December 31, 2020, at 14.27%. There is a marked increase and volatility in ROE during 2021, peaking sharply at 24.67% in the third quarter. This is followed by a decline to 13.75% in late 2022. Throughout 2023 and the first quarter of 2024, ROE remains relatively stable around values of approximately 14% to 16%. Entering 2025, ROE experiences a significant decline, dropping from 9.53% in the first quarter to 7.19% by June 30, 2025. This decline in ROE towards the most recent periods contrasts with the earlier peak and suggests reduced profitability or increased equity base impacts.

Net Profit Margin

The net profit margin exhibits an overall declining trend starting from March 31, 2021, where it reaches 5.91%, and peaking at 10.12% in September 30, 2021. After this peak, the margin experiences a gradual reduction moving down to 6.9% by March 31, 2023. From that point onward, the margin stabilizes moderately around the 6.3% to 6.8% range until December 31, 2024. However, a pronounced decline occurs thereafter, dropping sharply to 3.5% by March 31, 2025 and further decreasing to 2.79% by June 30, 2025. This suggests a recent contraction in profitability per unit of sales.

Asset Turnover

Asset turnover demonstrates a steady improvement throughout the periods analyzed. Initial values in 2020 are not recorded for the first quarter, but from March 31, 2021 forward, the ratio hovers in the range of 0.46 to 0.58, with a marked positive trend starting from 0.46 and increasing gradually to the high 0.5 range by the end of 2024. The highest values appear between March and June 2025, where turnover peaks around 0.61, indicating enhanced efficiency in utilizing assets to generate revenue.

Financial Leverage

Financial leverage ratio shows a declining trend over the initial years, beginning at 6.15 in March 31, 2020 and decreasing consistently to about 3.78 by September 30, 2023. This indicates a reduction in the company’s relative use of debt financing or other liabilities. However, from late 2023 onward, a slight upward adjustment is noticeable, rising back to values around 4.44 by March 31, 2025 and maintaining near that level through June 30, 2025. This suggests a moderate increase in leverage after a prolonged period of deleveraging.

Return on Equity (ROE)

The return on equity displayed significant volatility. Starting at 14.27% at the earliest noted period, ROE peaked impressively at 24.67% by September 30, 2021, demonstrating strong shareholder returns during that time frame. Following the peak, ROE declined sharply and fluctuated around the mid-teens, generally between 13% and 16% until December 31, 2024. A downward trend resumes thereafter, with ROE falling to 9.53% by March 31, 2025 and further declining to 7.19% by June 30, 2025, indicating weakened profitability relative to equity investors in the most recent periods.

The financial analysis reveals several notable trends in profitability, efficiency, and leverage ratios over the observed periods.

Tax Burden

The tax burden ratio remains relatively stable with minor fluctuations, generally hovering around 0.78 to 0.95. Starting from 0.78 in early 2021, it peaks near 0.95 by late 2023 and then gradually declines to approximately 0.68 by mid-2025. This suggests a slight reduction in tax obligations relative to pretax income in the latter periods.

Interest Burden

The interest burden ratio shows a high level of consistency, predominantly residing between 0.88 and 0.94 throughout the periods. This consistency indicates that interest expenses remain relatively stable against earnings before interest and taxes, signifying controlled financing costs.

EBIT Margin

The EBIT margin exhibits a downward trend over the analyzed quarters. It emerges at around 8.56% in early 2021, reaches a peak of nearly 13.91% by the third quarter of 2020, and then steadily declines to below 5% by the end of the observed period in mid-2025. This decline indicates narrowing operating profitability over time, possibly attributed to increased costs or pricing pressures.

Asset Turnover

Asset turnover shows a generally positive trend, increasing from approximately 0.46 in early 2021 to about 0.61 by mid-2025. The improvement points towards enhanced efficiency in utilizing assets to generate sales, reflecting better operational performance or asset management.

Financial Leverage

Financial leverage decreases from a high of 6.15 in early 2020 to around 3.78–4.44 levels in the subsequent years, reflecting significant deleveraging during the period. However, a slight increase is observed starting in late 2023, suggesting a cautious uptick in leverage possibly to support growth or investment activities.

Return on Equity (ROE)

ROE displays considerable volatility, rising from around 14.27% to a peak of 24.67% in the third quarter of 2020, followed by a progressive decline to near 7.19% by mid-2025. The early high ROE levels can be associated with higher profitability and leverage, whereas the decline may reflect reduced operational margins and stabilization of leverage.

Overall, the data indicate a period of initial profitability and high returns, followed by a trend towards lower operating margins yet improved asset efficiency. Leverage reduces significantly post-2020 but shows signs of a mild increase toward the latest periods. These dynamics suggest a strategic balance between risk reduction and operational enhancement efforts in recent years.

Net Profit Margin

The net profit margin shows a rising trend from March 2020 to December 2021, increasing from 5.91% to a peak of 10.12% in September 2021, followed by a gradual decline to 6.33% by December 2023. Thereafter, it remains relatively stable in the mid-6% range through the first three quarters of 2024 before experiencing a notable decline in 2025, falling to 2.79% by June 2025. This suggests an initial improvement in profitability that weakened significantly towards the end of the observed period.

Asset Turnover

Asset turnover remains relatively stable throughout the periods, starting at 0.46 in March 2020, reaching a modest increase to about 0.58 by March 2024, and demonstrating slight fluctuations around this level until mid-2025. The ratio peaks at 0.61 in mid-2025 before a minor dip. Overall, this consistency indicates a steady efficiency in utilizing assets to generate revenue, with some gradual improvement over time.

Return on Assets (ROA)

ROA exhibits an upward trend from 2.73% in March 2020 to a high of 5.27% in September 2021, indicating improved profitability relative to assets during that period. Following this peak, ROA declines steadily to approximately 3.56% by December 2023. It then stabilizes in the range of 3.7% to 3.9% through most of 2024 before dropping sharply to 1.65% by September 2025. The decrease towards the end reflects diminishing efficiency in asset utilization to generate earnings during the latest periods.

Tax Burden

The tax burden ratio exhibits moderate fluctuations over the observed periods, beginning around 0.78 in early 2021 and increasing to a peak of 0.95 by the end of 2023. Subsequently, a declining trend is observed, with the ratio falling to approximately 0.68 by mid-2025. This pattern suggests variability in the company's effective tax rate or tax-related impacts on earnings, with a notable increase followed by a gradual reduction toward the later periods.

Interest Burden

This ratio maintains relative stability throughout the timeline, generally remaining within the 0.88 to 0.94 range. The minor oscillations imply consistent management of interest expenses relative to earnings, with no significant upward or downward trend. The slight decreases after mid-2025 may indicate marginally increased interest costs or reduced operating earnings.

EBIT Margin

The EBIT margin demonstrates an initial upward movement, climbing from 8.56% in early 2021 to a high of nearly 13.91% around the third quarter of 2020, although data before 2021 is missing. Following this peak, a steady decline is observable, dropping to around 7-8% throughout 2023 and falling further to below 5% by mid-2025. This decline could indicate increasing cost pressures, lower pricing power, or other operational challenges affecting profitability.

Asset Turnover

Asset turnover shows a gradual upward trend, starting at approximately 0.46 and increasing steadily to around 0.61 by mid-2025. This suggests improved efficiency in utilizing assets to generate revenue over the periods, indicating a positive development in operational performance or asset management practices.

Return on Assets (ROA)

The ROA reflects growth in profitability relative to total assets from early 2021 to approximately 2024, rising from about 2.73% to close to 3.9%. However, after this peak, a notable decline occurs, reaching as low as 1.65% by mid-2025. The initial improvement aligns with the increased asset turnover and relatively stable interest burden, but the subsequent decrease corresponds with the falling EBIT margin, highlighting diminished overall efficiency in generating returns from assets in recent periods.

Tax Burden

The Tax Burden ratio shows a relatively stable trend from the first available data point in March 2021 through the end of 2023, maintaining values mostly between 0.78 and 0.86. Starting in early 2024, the ratio increases significantly, peaking at 0.95 in March 2024. Subsequently, it decreases steadily, falling to 0.68 by June 2025. This pattern suggests some variability in the effective tax rate impacting profitability during the latest periods.

Interest Burden

The Interest Burden ratio remains consistently high across all observed periods, with values fluctuating narrowly between 0.88 and 0.94. This indicates a stable interest expense profile relative to earnings before interest and taxes. There is no pronounced trend of increase or decrease, implying consistent financing costs over time.

EBIT Margin

The EBIT Margin exhibits strong improvement from March 2021 (8.56%) to its peak in September 2021 (13.91%), reflecting enhanced operating profitability. However, from late 2021 onward, there is a gradual decline with fluctuations, dropping significantly from around 8% at the beginning of 2024 to as low as 4.54% by September 2025. This downward trend points to intensifying operating pressure or increased costs affecting earnings before interest and taxes.

Net Profit Margin

The Net Profit Margin follows a pattern broadly consistent with the EBIT Margin. Initial gains are evident as the margin rises from 5.91% in March 2021 to 10.12% in September 2021. After this peak, the margin deteriorates gradually, showing periodic small recoveries but trending downward to 2.79% by September 2025. This decline in net profitability may be influenced by reduced operating margins, changes in tax burden, or other non-operating factors affecting bottom-line results.