Are These The Best Automotive Stocks To Watch Before December 2020?
Automotive stocks have been rather volatile in the stock market since the pandemic began. Many automotive companies had to halt all production due to guidelines in place earlier this year, sending a full blow to the industry. Even the industry leaders were not spared from the impacts brought by the coronavirus pandemic. Now that we have a few safe and effective coronavirus vaccines in the process of rolling out, things are starting to look up again for the industry. This has led investors looking for the top automotive stocks as cash-rich consumers are back with a vengeance in the post-pandemic world.
Some people think that the stock market today appears to be quite unusual. But its dynamic has been a boon for certain auto stocks. We saw Tesla (TSLA Stock Report) became the largest automaker by market capitalization amid the EV boom. This is huge for electric vehicle stock enthusiasts considering the company continues to report strong sales in the face of the pandemic.
Electric Vehicles & Autonomous Driving Are The Future Of The Auto Industry
It’s highly likely that some of the most exciting opportunities for the next few years will involve manufacturers of electric vehicles. EV stocks continue to march higher as demonstrated by Chinese EVs like XPeng (XPEV Stock Report) and Nio Inc. (NIO Stock Report). Shares of EV manufacturers are already seeing high growth this year, which is exciting for investors.
But it’s important to remember that the processes involved in developing and manufacturing electric vehicles aren’t all that different from those used by makers of traditional fossil fuel vehicles. And as technology improves over time, the costs will be lower. By then, electric vehicles could become a much more competitive market, much like the market for traditional vehicles today. It’s also important to note that traditional carmakers are also introducing EVs of their own. With all that being said, are these the top automotive stocks to buy in the stock market today?
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Best Automotive Stocks To Watch Now: General Motors
First, up the list, General Motors (GM Stock Report) is one of the best automotive stocks to watch in the stock market right now. The legendary automaker’s stock price reached a new 52-week high recently. This came after the potential partnership with Nikola (NKLA Stock Report) to build electric pickup trucks. But this is not an isolated development. It’s almost becoming a cliche now to say that GM is an old dog that can learn new tricks. The company is committing to 30 new EVs by 2025. By then, 40% of the company’s offerings in the U.S. will be electric.
One of the first among them comes in the form of a Hummer. And this time, it’s all-electric. Available from late 2021, the vehicle has a 350-mile range, 1,000 horsepower, and up to 11,500-pound-feet of torque. And with a starting price of $80,000, it’s easily twice the cost of a gas-powered pickup. Nevertheless, the resurrection of the legendary brand has certainly generated enough attention.
General Motors has an impressive lineup of EVs. The company’s Chevrolet Bolt and Chevrolet Volt are among the best selling EVs in the US. Both of the models are much more affordable compared to Tesla’s models. Meanwhile, the truck is expected to go into production late next year. GM’s diversified range of options would certainly be welcome news for customers. With the industry stalwart setting its sights on the future, will GM stocks continue to run up after a 30% rally in the past month?
Best Automotive Stocks To Watch Now: Ford Motor Company
Ford Motor Company (F Stock Report) is another top auto stock to watch in the stock market today. The automaker has been on an upward trend recently and witnessed its stock price jump more than 20% since the start of the month. The most recent rally came after the appointment of the new chief marketing officer. In addition, CEO Jim Farley is moving aggressively to trim warranty costs, an issue that has been plaguing Ford. The company may have strong sales, but it needs to improve its margins. And they are on the right track. Ford has been hard at work polishing its vehicle lineup. If you are a petrolhead, you would have noticed it as well.
In recent years, Ford has discontinued a number of models including the Fiesta, Focus, Taurus, and Fusion. It is focusing more on trucks and SUVs which offer higher margins. Morgan Stanley analyst Adam Jonas estimated that the F-Series pickup trucks could contribute to 90% of the company’s worldwide profits. That is a testament to Ford’s image as a pickup truck specialist. The upcoming Ford Bronco which is coming to the market next year could also be a boost to Ford’s profits. Many are already giving rave reviews, with its retro styling.
Apart from those mentioned above, the company also invested heavily in the electric vehicle and autonomous vehicle end. You can say that Ford has tremendous potential to become a force to be reckoned with its major restructuring and the introduction of more technology into its vehicles. As the iconic American auto pioneer continues to keep up with the times, will F stock see brighter days ahead?
Best Automotive Stocks To Watch Now: Geely Automotive
Geely (GELYY Stock Report) is an automotive company that is based out of China. The company owns a plethora of automotive brands including but not limited to Lotus, Polestar, Volvo, and more. The company’s stock price has surged nearly 50% in the past 30 days to close at $62.05 per share on Tuesday. This came after the news that the company will form an alliance with Daimler to build next-generation combustion engines for use in hybrid vehicles.
The tie-up came on the back of the high-flying stock performance of Chinese electric vehicle stocks this year as sales in the world’s largest auto market improved. It provided a shot in the arm for the GELYY stock investors as the impact of the pandemic diminished. The company seems to be rebounding quite well despite its rough start this year. Does that make GELYY stock attractive enough for you to include on your watchlist?