GM Just Beat Earnings Estimates. Is Ford Still the Better Dividend Stock?

Quick Read

• Ford (F) yields nearly 5% versus GM’s (GM) sub-1%, making Ford the clear winner for investors who need cash income today.

• GM’s dividend is covered 18 times by free cash flow versus Ford’s 2.6 times, making GM’s payout far safer for long-term holders.

• GM’s stock gained 187% over ten years versus Ford’s 62%, and a 37% share count reduction since 2023 makes it the stronger compounder.

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Between Ford Motor Company (NYSE:F) and General Motors (NYSE:GM), which dividend is better for retirement savers? GM reported third-quarter adjusted EPS of $3.70 today, beating the $3.63 estimate, and announced a $20B buyback. Even so, the stock fell 7.84% in the session after management signaled rising cost pressures. Ford trades at $12.10 and is down 4.62% year to date.

Yield and Income: Ford Puts Far More Cash in Your Pocket

Ford pays $0.15 per share each quarter, or $0.60 a year. At the current price, that’s a yield of about 4.96%. That regular amount is the reliable base for income planning. The larger payments of $0.33 in February 2024 and $0.30 in February 2025 were one-time extras, and the February 2026 payment came in at the regular quarterly rate.

GM raised its quarterly dividend to $0.18 from $0.15, bringing the annual total to $0.72. On a $76.27 share price, that yields roughly 0.94%. Winner: Ford.

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Dividend Safety: GM’s Payout Is Nearly Untouchable

Ford’s dividend costs about $2.35 billion a year. The company expects $6 billion to $7 billion of adjusted free cash flow in 2026, so even the low end covers the payout about 2.6 times. Ford also holds $22.3 billion in cash. The weak spots sit on the balance sheet. Debt-to-equity stands at 4.66 and interest coverage at just 2.02. Ford posted a second-quarter GAAP net loss of $1.33B after $4.2B in special charges, and it expects Model e losses of about $4 billion this year.

GM’s dividend costs only about $632 million a year. Its raised adjusted automotive free cash flow guidance of $11.5–$12.5B covers that roughly 18 times at the low end. GM is profitable on a GAAP basis, with debt-to-equity of 2.13 and interest coverage of 4.00. Winner: GM.

Long-Term Track Record: GM Has Compounded While Ford Stalled

Over five years, GM’s adjusted share price rose 37.96% while Ford’s slipped 2.29%. Over ten years, the gap widened: GM gained 187.08% while Ford gained 62.16%. Ford is also the bumpier ride, with a beta of 1.939 compared with GM’s 1.4. GM’s chief executive said the company has “reduced our fully diluted shares by 37%” since 2023. As the share count shrinks, each remaining share claims a bigger piece of earnings and dividends. Winner: GM.

Verdict: Ford Wins for Income Now, GM Wins for Retirement Builders

For income investors who need cash today, Ford offers the better dividend. At a yield near 4.96%, covered more than twice over by free cash flow guidance, it pays real bills in a way GM’s sub-1% yield cannot. Ford also raised its 2026 adjusted EBIT guidance to $10.0–$11.0B, and management said, “We remain committed to our investment grade rating in returning capital to shareholders.” Ford’s leverage is the risk to watch. Its next earnings report will show whether free cash flow stays on track as EV losses narrow.

GM wins for retirement savers who are still years away from drawing income. A 20% dividend raise, heavy buybacks, and a stronger balance sheet make it the better compounder. GM also warned of a bumpy 2027, and today’s selloff shows investors took that warning seriously. On dividend income alone, Ford holds the edge.

Learn 7 Ways To Generate Income With A $1,000,000+ Portfolio

If you’ve saved over $1,000,000, this guide is for you. The last thing you want in retirement is to run out of money, you want your money to generate lasting income while you enjoy your life.

Now you can learn the strategies wealthy retirees use to fund their retirement with The Definitive Guide to Retirement Income from Fisher Investments. Download the guide today! (sponsor)

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