General Motors Company (NYSE:GM) went public again in late 2010. Since then, it has been tough going for the U.S. automakers. An investment in Ford Motor Company (NYSE:F) is down slightly over the past six years. GM stock has rallied, but only modestly. It’s up about 10.2% since the IPO. Regardless, both have trailed the market dramatically. The S&P 500 has roughly doubled within that timeframe.

There are several theories for why GM stock has struggled. Some investors still have it in the penalty box due to its previous bankruptcy. That probably isn’t fair. The stock looks extremely cheap now on an earnings basis, probably in part due to investor aversion.

However, there are real downsides to GM stock that should be considered as well.

GM Stock Cons

Financing Troubles Loom: The Wall Street Journal recently documented the fading state of the auto lending industry. The WSJ reported that, “In the first three quarters of 2016, the number of these new-car purchases with negative equity on previous loans reached a record 32% of all trade-ins, according to Edmunds data. That is up from 30% in the same period a year earlier and just 22% five years ago. The average amount of negative equity also reached a record, at $4,832.”

Given that a new car costs around $33,000, that’s a fairly substantial amount of negative equity, about 15% of the price of a new vehicle. Many new car buyers are funding that equity gap by borrowing more than 100% of the value of their subsequent vehicle purchase. This causes duration of car loans to extend even farther, it’s out to almost seven years now, and increases further the risk to financing arms of the auto companies.

Legacy Issues Remain: GM stock continues to struggle with several of the issues that led it to bankruptcy a decade ago. For one thing, its European operations continue to underperform. A sale of spin-off of parts of this division could be a positive catalyst for GM stock, however.

More daunting is General Motor’s ongoing underfunded pension problem. The company has about $20 billion in shortfall in its pension, with close to half that due to U.S. workers. This makes the company substantially less cheap than you’d think just looking at its valuation metrics. To fully close the underfunded pension problem, it would require GM to throw at least two years of earnings at the problem. Given its pension issue, General Motors retains a mediocre credit rating despite its strong profitability.

Cyclical Peak Approaching? The American consumer has been feeling a lot better lately. After years of a fairly tepid economic recovery, consumers have felt more confident lately. This has led to a boom in the housing and auto markets. Car sales finally hit a new annual high in 2015, breaking a record that had stood for 15 years. Auto sales were virtually unchanged in 2016, representing another huge year for the industry.

GM’s earnings, not surprisingly, have soared. The company earned $3.10 in 2012. This dropped to $2.71 in 2013 and further declined to just $1.75 in 2014. Then, as sales boomed in 2015, EPS boomed to over $6. GM repeated that huge figure in 2016. However, should the auto industry go back to 2012-2014 levels of sales, look for earnings to decelerate sharply, sending the price-to-earnings ratio back into the teens. And earnings could well go negative again in the event of a bigger bust. As noted, the financing arms of the auto companies are taking more and more risk as buyers’ credit qualities decline.

GM Stock Pros

Cheap Stock: GM stock is one of the cheapest stocks in the U.S., at least if you use trailing P/E ratios as your guide. Out of the whole S&P 500, GM sports the fifth-lowest P/E ratio of all the index companies. GM’s comes in at just 6.2 on that metric.

Even other popular value stocks rate as more expensive. Gilead Sciences, Inc. (NASDAQ:GILD) is up at a 7.1 trailing P/E ratio. Delta Air Lines, Inc. (NYSE:DAL) has a 8.7 trailing P/E. Michael Kors Holdings Ltd (NYSE:KORS) is at 8.4. Even these other seemingly cheap value stocks don’t rate as well GM stock based on price-to-earnings.

The stock scores cheap on various other valuation metrics as well. Its 0.34 price-to-sales ratio is impressive, both on an absolute basis and compared with its industry. Its 6 EV/EBITDA ratio is almost unheard of in 2017.

Big Dividend: Not surprisingly, General Motors is able to offer a substantial dividend out of its earnings. With a P/E ratio of 6.2, it is effectively generating a 16% earnings yield. That gives it a great deal of capital with which to reward shareholders.

The company is paying a 4% dividend, which is certainly quite large. It gets more impressive when you consider that this generous dividend represents a merely 25% dividend payout ratio. GM stock could offer a much higher dividend if management felt so inclined. The company is also engaging in share buybacks, which should help shareholders, though thus far much of the buybacks have gone to offset insider selling.

Lyft Investment: One of the best parts of the General Motors story is its investment in Lyft. GM invested $500 million in the company early last year. As part of that, the two firms formed a partnership to bring self-driving cars to Lyft.

While it’s too early to forecast who will win the ride-sharing market with much confidence, things are looking up for Lyft. Uber has had a very bad couple of months. Political controversies erupted around the company, including charges of sexism and unwanted associations with President Donald Trump. As any Target Corporation (NYSE:TGT) shareholder can tell you, political controversy is generally not a good thing.

Uber CEO Travis Kalanick just got into an ugly argument with one of his company’s drivers that was caught on camera. And the company’s finances continue to underwhelm.

All this bodes well for Lyft. It’s still the underdog of the two, but its competitive position may be improving. And if it does, Lyft could get to the sort of valuations that Uber was recently quoted at, making GM’s investment a multi-bagger. And that says nothing of the potential sales into the self-driving car partnership.

Verdict on General Motors

General Motors looks like a really cheap stock. The bull case is easy to make. The company is undervalued because people are still upset about what happened in 2008. Buy at a 6 P/E ratio and enjoy the fat dividend. Additionally, Lyft offers a solid upside option to the stock. However, don’t overlook the risks here. The company is enjoying the tail end of a big industry boom, and the coming slowdown will likely drop earnings quite a bit.

As of the time of this writing, Ian Bezek owned GILD stock. He had no position in GM stock. You can reach him on Twitter at @irbezek.