With many factors coming into play during the grueling winter months, investors have developed a keen eye for automotive stocks. With oil prices hitting all-time lows, more money is being put into the pockets of investors.
Many auto companies seemed to be achieving minimal spreads on stock price increases. Ford Motor Co. and General Motors Co. have some great upside potential stemming from recent gains within their respective companies.
The two popular automotive manufacturing companies, GM and Ford, have been reporting record sales and earnings. Since its last earnings date, GM has performed at a solid pace.
GM is also on track to pass its 52-week high currently priced at $36 a share. Some important stats to consider from the month of January include Chevrolet’s sales going up 20 percent, GMC sales going up 14 percent and Cadillac’s deliveries were rising a solid percent.
The rigorous drop in crude oil prices and positive sales overseas has helped stimulate growth for GM and Ford during the past month. Ford has kept its growth in the same direction as GM. Ford has recorded a year-to-date sales growth of 15 percent and will be looking for another positive year.
Both car-manufacturing companies’ stocks are valued relatively low right now, which could surge investors’ interests as well. Although there are many doubts overseas, production in the U.S. has been consistent during the past year.
Additionally, the gross domestic product growth and the creation of new jobs could allow for more car sales. Combine these factors with the decline of gas prices across the country, and the automobile industry looks promising.
Many investors believe we have not truly rid ourselves of the recent recession, which is withholding consumer spending; however, GM and Ford have continued to revamp sales and deliveries to show they are outperforming the economy.
These two undervalued companies could most certainly be a great investment in this stagnant economy.
Feb. 13, 2015