Stock Wars: GM Vs. Ford Vs. Tesla Vs. Toyota
It has been a rough five-year stretch for large auto stocks Toyota Motor Corp (NYSE: TM), General Motors Company (NYSE: GM), Ford Motor Company (NYSE: F) and Tesla Inc (NASDAQ: TSLA). Auto investors are much more concerned about the next five to 10 years at this point. When looking at U.S. auto sales, it’s not cars, but light trucks, SUVs and crossovers that matter — because that’s what Americans are buying. Tesla should be the obvious leader in the EV movement, since it is the only big carmaker that makes solely electric vehicles. But it’s hard to say who might come out on top in the EV space, because all of the carmakers see it as an important part of their future. Ford said last year it will more than double its spending on its EV program, and Barra has promised to make electric cars profitable for GM — something no one’s been able to yet do — by 2021. While not winning on pure electric sales, Toyota’s hybrid sales were trending up in the first half of the year, putting it on track to be the U.S. market leader in “green vehicle” sales in 2019. Both stocks are priced well below the S&P 500 average of 0.9. Ford’s future five-year earnings growth is projected to be negative, and Tesla has yet to demonstrate it can consistently turn a profit at scale. When a company reinvests a large portion of earnings back into the company for the purpose of expanding operations and growing the business, earnings numbers aren’t the best measure of a company’s performance or a stock’s value.