General Motors Co. (NYSE: GM) announced Monday morning a few changes that have investors buzzing. First of all, the auto giant reaffirmed a strong and growing dividend policy, and it authorized a $5 billion share repurchase program that will be effective immediately. The main goal behind this is to reinvest in the business in order to drive return on invested capital (ROIC) about 20% higher.

Among other plans released by the company to achieve this goal, GM has a target cash balance of $20 billion while maintaining an investment grade balance sheet. The company also plans to return all available free cash flow to shareholders.

In terms of the repurchase plan, it begins immediately and will conclude before the end of 2016. Previously, GM had announced its intent to increase its quarterly stock dividend to $0.36 per share, which would be effective in the second quarter of 2015. This would result in an expected dividend payout of approximately $5 billion through year-end 2016.

In a quote directed toward investors, Mary Barra, chief executive officer of GM, said:

As we continue to execute on our plan to become the most valued automotive company, our track record of improved operating performance, strong earnings momentum, and disciplined capital investments provide the foundation for a comprehensive capital allocation framework. We will continue to invest in innovative technologies and world-class vehicles that will deliver sustained profitable growth and maximize returns to shareholders.

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So far GM shares have performed decently year-to-date, up 5.5% compared to the likes of Ford Motor Co. (NYSE: F) which is only up 3.8%. It is also worth mentioning that the stock is nearing its 52-week high on its trading range of $28.82 to $38.18. In the second half of 2013, shares were above $41, and GM shares were above $40 for much of that year.

It would appear the Oracle of Omaha made a solid call in his most recent holdings report. Warren Buffett took a larger stake in GM, increasing his holdings to 41 million from 40 million.

In recent memory GM has been plagued by recalls that have repeatedly hampered growth in its stock. However, GM hasn’t been the auto company suffering these recalls and has performed well, comparatively in the face of this adversity. Its February sales made a strong push to where its current position is.

Considering these recent developments, GM is trying to telegraph to investors that the company is poised to take on 2015 and 2016 by being aggressive on returning capital to shareholders and running with solid financials.

In Friday’s trading session, shares closed down 2% at $36.84 with a steep market sell-off. However, following this announcement, shares were 2.5% higher to $37.78 in Monday’s premarket trading indications. GM’s stock has a consensus analyst price target of $41.81, implying an upside of 13.5% from Friday’s close.

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