The auto industry, with its long-standing influence on the stock market, has always been a reliable choice for investors. However, given the ever-changing economic landscape and the rise of electric vehicles (EVs), not all auto companies fare equally on the stock market. Some have managed to ride the tide and emerge as strong contenders even amid inflation and increasing competition.
With this in view, let’s delve into the top three auto stocks worth considering for purchase this April.
First on the list is Ford Motor Company (NYSE:F). An iconic American auto brand, Ford has managed to stay in the forefront of the auto stock race despite its long history. The company recently reported an income of $46 billion in Q4, along with a free cash flow of almost $7 billion for 2023. Ford also witnessed an impressive jump in sales with an increase of over 180,000 units compared to 2022.
“Ford has reported an incredible 86% jump year-over-year (YOY) in EV sales this quarter, further propelling the stock upwards.”
Such robust numbers have led to an optimistic forecast for Ford’s future earnings. Moreover, the company plans to trim expenses by $2 billion and increase its YOY income, making it a promising investment. The recent announcement of Ford reducing its F-150 lightning model’s price by over $5,500 also shows its commitment to boosting the sales of its popular EV models. Given these factors, Ford is a stock to invest in without delay.
Another top auto stock is General Motors (NYSE:GM). This American automaker has maintained a stable performance in its quarterly earnings, contributing to its steady share growth in 2024. The company reported a significant increase in its earnings for Q1 this year on April 23, triggering an upward trajectory for the stock.
“GM smashed revenue and adjusted EPS estimates and has already climbed by 5% as a result.”
Despite a lukewarm performance in the Chinese market, the company’s North American sales have compensated, leading to a 26% boost in net income this quarter compared to last year. As GM plans to increase EV production this year, the momentum is expected to continue, making it an ideal choice for investors.
Last but not least, Ferrari (NYSE:RACE), a luxury auto brand, has firmly secured its place in the top three auto stocks. Defying the norm of niche market stocks being less appealing, Ferrari has seen a price surge of over 300% in the past five years. The company’s Q4 2023 results showed a 33.88% rise in diluted EPS and a profit margin increase of nearly 20% YOY.
While Ferrari’s stock may be costly, there’s no denying the company’s ability to deliver consistent results and returns. With the company set to release its Q1 results on May 7, it’s a stock to keep an eye on and consider adding to your portfolio.
The auto industry continues to promise exciting opportunities for investors. However, it’s crucial to carefully analyze market trends and the performance of individual companies to make an informed decision. As of the publication date, the author held no direct or indirect positions in the stocks mentioned in this article.
Let us know what you think. Please share your thoughts in the comments below.
