I’ve outlined various reasons I expect a slowdown in auto sales in another article, which you can read by clicking here. I’ll be the lone voice of dissent here and recommend avoiding Ford for the time being. However, that doesn’t mean I’m not eyeing it for future investment, should the predicted slowdown kick in and make the stock even more attractive.
Sean’s take
It’s taken me quite some time to come around to Ford Motor Company (NYSE:F) after its near-bankruptcy during the recession, but its focus on four key areas has renewed my faith in the company.
First, Ford is working vigilantly to provide the combination of better fuel efficiency as well as horsepower. We’ve seen exactly this with the introduction of its EcoBoost engines in 2009, which use turbochargers for extra horsepower when needed but use less fuel. Sales of EcoBoost engines should double this year alone from the combined production over the previous three years.
Secondly, Ford is mopping the floor with the competition in fast-growing emerging markets such as China. In March, Ford saw its unit sales jump 65% in China, compared with just 11% for General Motors Company (NYSE:GM) and negative returns for both Honda Motor (NYSE:HMC) and Toyota. Ford is using the ongoing strife between China and Japan’s carmakers to turn the tide and pull a similar number to what they did to the U.S. market in the 1980s and 1990s.
Third, Ford Motor Company (NYSE:F) is leading the charge when it comes to the revival of the muscle car. Unlike many of the other reintroduced models, the Mustang has been in production for nearly 50 years now. You simply won’t find a car with bigger horsepower potential for a lower MSRP price point than the Mustang, and it’s exciting car buyers to get behind the wheel once again.
Finally, Ford is relying on its dependable F-Series of trucks to drive over the competition. With General Motors Company (NYSE:GM) failing to significantly remodel the Silverado and Sierra for a span of approximately six years, the F-Series has maintained steady market share as one of America’s top-selling vehicles.
None of this would be possible without the top-notch leadership and innovation of CEO Alan Mulally, who has completely revamped Ford’s lineup around the globe. If you’d like to read my more thorough analysis of Ford Motor Company (NYSE:F), click here, but my overall opinion is that it’s time to hit the gas pedal!
The final call
It’s not without hesitation that we give an outperform call on Ford. We’ll watch economic trends and Ford’s results closely to see if there are fundamental changes in our thesis and close out the call if we think it’s necessary. For more of our market-beating picks, check out our TMFYoungGuns CAPS page. Our 25 picks have outperformed the market by 356 points so far and we’re adding more picks every week.
The article Analysts Debate: Is Ford a Top Stock? originally appeared on Fool.com and is written by Travis Hoium, Sean Williams, and Alex Planes.
Fool contributors Alex Planes, Sean Williams, and Travis Hoium have no position in any stocks mentioned. You can follow Travis on Twitter at @FlushDrawFool, Sean at @TMFUltraLong, and Alex at @TMFBiggles. The Motley Fool recommends Ford and General Motors and owns shares of Ford.
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