Ford Motor can make up ground after significantly underperforming competitor General Motors , according to Morgan Stanley. Adam Jonas, a well-known auto analyst at the investment bank, said Ford remains his top pick in the auto sector. That is despite the stock sliding around 2% over the past 6 months, while GM shares have climbed about 34% during the same period.
What is even more eye-catching is for 18 days over April and May, the six-month performance gap widened to over 40 percentage points between the two stocks. There have only been two other times since the revamped, postfinancial crisis of GM's 2010 initial public offering that one of the stocks has outperformed the other by that large a gap. F GM 6M mountain Ford vs.
General Motors over the last 6 months One straw in the wind is that the gap has narrowed since late May. Now, Jonas said Ford could take the spotlight as the focus within the sector shifts from electric vehicle investment to capital discipline. It comes at a tumultuous time for automakers as they grapple with softer-than-anticipated electric vehicle demand.
As the excitement around EVs has cooled, investor interest has turned instead to how car companies will preserve cash. "We see an opportunity for Ford [to] narrow the gap by moving the needle toward capital discipline," Jonas told clients in a Monday note. Given an ongoing "unwind" in the electric vehicle story, he said Ford has the potential to flip the stock performance.
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