U.S. automakers Ford Motor Company (NYSE: F) and General Motors Company (NYSE: GM) are hovering around their 52-week high as improving U.S. auto sales are continuing to benefit the two companies.
Last week, a report showed that auto sales rose to pre-crisis level in the month of July. Both Ford and GM registered a sharp rise in July U.S. auto sales
While Ford registered an 11% increase in U.S. auto sales, GM posted a 16% increase in sales. More importantly, the outlook for U.S. auto sales remains robust.One of the major factors behind improving auto sales has been increasing demand for pickup trucks, which is being driven by an ongoing improvement in the economy.
Last week, a data from the Commerce Department showed that the U.S. economy grew more than forecast in the second quarter of 2013, while manufacturing activity accelerated in the month of July.
The big question is whether you should buy automakers at current levels. The answer is probably yes as the recovery in the auto market is expected to continue, benefiting both Ford and GM. In terms of valuation, both Ford and GM are looking attractive right. Ford is trading on a P/E ratio of just 11.52, while GM is currently trading on a P/E ratio of 13.25. Given these factors, there is certainly further upside potential in automaker
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While Ford registered an 11% increase in U.S. auto sales, GM posted a 16% increase in sales. More importantly, the outlook for U.S. auto sales remains robust.One of the major factors behind improving auto sales has been increasing demand for pickup trucks, which is being driven by an ongoing improvement in the economy.
Last week, a data from the Commerce Department showed that the U.S. economy grew more than forecast in the second quarter of 2013, while manufacturing activity accelerated in the month of July.
The big question is whether you should buy automakers at current levels. The answer is probably yes as the recovery in the auto market is expected to continue, benefiting both Ford and GM. In terms of valuation, both Ford and GM are looking attractive right. Ford is trading on a P/E ratio of just 11.52, while GM is currently trading on a P/E ratio of 13.25. Given these factors, there is certainly further upside potential in automaker
Original post :- Click here
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