Analysts on Ford and GM
According to data compiled by Reuters, 24.0% of the 25 analysts covering Ford (F) stock gave it a “buy” recommendation. In comparison, 36.0% of the 25 analysts covering General Motors (GM) stock gave it a “buy” recommendation.
About 68.0% of analysts rated Ford a “hold,” and 8.0% rated it a “sell.” About 60.0% rated GM a “hold,” and 4.0% rated it a “sell.”
12-month upside potential
As of September 6, 2017, Wall Street analysts’ 12-month consensus target price for Ford Motor was $12.13. It reflected an upside potential of 5.5% from its market price of $11.50. Analysts’ consensus target price for GM was $38.74, which was an upside potential of 2.8% from its market price of $37.67.
Investors should pay attention to Wall Street analysts’ views. If a popular analyst changes its views on a stock, a significant short-term movement could occur in the stock.
As of September 6, 2017, Ford stock has fallen 5.2% so far in 2017, while GM stock has risen 8.1% on a year-to-date basis.
Clearly, a higher percentage of analysts are currently positive on GM compared to Ford. GM’s solid 2Q17 earnings (IYK) against Ford’s mixed 2Q17 results could be the primary reason why more analysts are more confident on GM stock.
Next, let’s compare US automakers’ valuation multiples.