GM Stock Has Slid. Chief Financial Officer Paul Jacobson Bought Up Shares.

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“I think GM is undervalued, and a great investment,” says company CFO Paul Jacobson, who recently bought $1.4 million of the beaten-down stock.

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General Motors stock has tumbled this year, and Chief Financial Officer Paul Jacobson scooped up shares of the auto giant.

GM (ticker: GM) stock has lost about a third of its value in 2022, about even with rival Ford Motor (F), and compared with a 13% drop in the S&P 500 index. At the end of last year, we named GM as one of our top stock picks for 2022. We noted that it is “as well positioned as any of its peers and is valued at less than a tenth of Tesla (TSLA).”

But this year has seen the company idling plants due to the ongoing chip shortage. The company also increased a controlling stake in its Cruise autonomous-driving unit, which isn’t yet profitable, although GM reported strong first-quarter earnings at the end of April.

Jacobson paid $1.4 million on April 28 for 35,000 GM shares, an average price of $38.79 each, according to a form he filed with the Securities and Exchange Commission. He now owns 110,000 GM shares.

“The purchase speaks for itself,” Jacobson told Barron’s. “I think GM is undervalued, and a great investment.”

He joined GM in December 2020, and is a former CFO of Delta Air Lines (DAL).

GM has stock-ownership requirements of its executive officers and directors, and Jacobson is expected to own four times his annual salary in stock, according to the company’s latest proxy. He was paid a $1 million base salary in 2021. But GM officers and directors have five years to meet the ownership requirements, so Jacobson wasn’t obligated to buy this much stock this quickly.

Inside Scoop is a regular Barron’s feature covering stock transactions by corporate executives and board members—so-called insiders—as well as large shareholders, politicians, and other prominent figures. Due to their insider status, these investors are required to disclose stock trades with the Securities and Exchange Commission or other regulatory groups.

Write to Ed Lin at edward.lin@barrons.com and follow @BarronsEdLin.