Jim Cramer Says General Motors (GM) Could Be 'Ridiculous' Value Trap

We recently published a list of 10 Stocks on Jim Cramer’s Radar These Days. In this article, we are going to take a look at where General Motors Company (NYSE:GM) stands against other stocks on Jim Cramer’s radar.

Jim Cramer in a latest program on CNBC talked about the latest trends in the AI data center industry and said that based on reports from some of the leading companies, there is no  slowdown in demand:

“Now that earning season is well underway, we’ve heard from a bunch of companies connected to the AI data center theme, and you know what? They’ve been putting up pretty darn good numbers. It’s almost like there was never anything wrong with the AI infrastructure story in the first place.”

Cramer then talked about several major AI companies and said that most top firms are seeing strong demand for data centers. He believes Satya Nadella-led tech giant slowed down its AI spend amid its “breakup” with OpenAI.

“Wall Street’s become very skeptical, and I don’t think that’s really changed. But looking at what we’ve seen so far this earning season, I’m feeling much more sanguine about the story, especially if we get some more trade war de-escalation from the White House and stocks stay as cheap as they are. And man, are they ever cheap.”

READ ALSO 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In

For this article, we picked 10 stocks Jim Cramer recently talked about during his shows on CNBC. With each company, we have mentioned its latest hedge fund sentiment. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

General Motors Company (NYSE:GM)

Number of Hedge Fund Investors: 64

Jim Cramer in a latest program said that General Motors Company (NYSE:GM) was a cheap stock based on its PE ratio but given the potential impact of the new tariffs, the stock could be a “value trap.”

“Their future earnings are in grave danger. Turns out Ford and GM could be ridiculous value traps. While the president thinks these tariffs are a great way to create jobs in America, they’re going to put our automakers at a severe disadvantage to Nissan, Toyota, Mazda, Subaru, and Honda, along with Kia and Hyundai. A 25% tariff on imports from Mexico is basically a subsidy for those companies.”

Hotchkis & Wiley Large Cap Value Fund stated the following regarding General Motors Company (NYSE:GM) in its Q3 2024 investor letter:

“General Motors Company (NYSE:GM) is one of the world’s largest manufacturers of passenger vehicles. GM reported a strong Q2; however, management provided a cautious outlook for the second half of 2024. Comments from GM mirrored those of other OEMs and auto suppliers, leading investors to believe the automotive cycle has peaked. We believe this is an overreaction, and we continue to view GM as an attractive investment. We like GM for many reasons. First, we believe GM has leading market positions in its main business segments. Second, the valuation is extremely attractive. Finally, it is a strong free cash flow generator, and the management team is committed to repurchasing their undervalued shares.”

Overall, GM ranks 4th on our list of stocks on Jim Cramer’s radar. While we acknowledge the potential of GM as an investment, our conviction lies in the belief that under the radar AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than GM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.