GM suspends its dividend and stock repurchases to preserve cash

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Shares of General Motors Co. GM, +2.27% fell 1.1% in premarket trading Monday, after the auto maker said it was suspending its dividend and stock repurchase program to help preserve cash amid the coronavirus pandemic. GM last paid a quarterly dividend of 38 cents a share on March 5. Based on Friday’s stock closing price of $21.95, the annual dividend rate had implied a dividend yield of 6.92%, compared with the implied yield for the S&P 500 SPX, +1.47% of 2.08%. Among other moves to strengthen liquidity, GM said it has extended $3.6 billion under its three-year revolving credit agreement to April 2022. “We continue to enhance our liquidity to help navigate the uncertainties in the global market created by this pandemic,” said Chief Financial Officer Dhivya Suryadevara. GM’s stock has tumbled 34.3% over the past three months through Friday, while the Dow Jones Industrial Average DJIA, +1.50% has dropped 16.7%.

Originally Published on MarketWatch

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