10 Best Auto Stocks To Buy Now

Published November 7, 2022 at 8:14 am EST Updated August 31, 2026 at 8:40 pm EDT

In this article, we discuss 10 best auto stocks to buy now.

The automotive sector is one of the most rate-sensitive segments of the economy, and the Federal Reserve’s hawkish moves this year have left a mark on the industry in terms of higher borrowing costs for both auto suppliers and original original equipment manufacturers (OEMs). Research and development investments, as well as other capital expenditures are now more expensive. This will cut into auto margins, which were running high after the pandemic eased and pent-up consumer demand hit the markets. However, prices of automobiles are also rising simultaneously, especially as the industry shifts towards electrification of vehicles.

According to McKinsey, the automotive revenues will meaningfully increase as the market transitions towards on-demand mobility and data-driven services. This could add up to $1.5 trillion in additional revenue by 2030, compared to roughly $5.2 trillion from conventional car sales and aftermarket products/services. Although global car sales will continue to grow, the annual growth rate is forecasted to decline from 3.6% over the last five years to approximately 2% by 2030. This drop will be primarily driven by macroeconomic factors and the rise of latest mobility trends such as carpooling and e-hailing.

However, emerging trends will continue to surprise the auto sector, and some of the best stocks to pick up in the space include Ford Motor Company (NYSE:F), General Motors Company (NYSE:GM), and Rivian Automotive, Inc. (NASDAQ:RIVN).

Our Methodology

We selected the following auto stocks based on positive analyst coverage, strong business fundamentals, and robust dividend profiles. We have assessed the hedge fund sentiment from Insider Monkey’s database of 895 elite hedge funds tracked as of the end of the second quarter of 2022.

Photo by Lenny Kuhne on Unsplash

Best Auto Stocks To Buy Now

10. Proterra Inc. (NASDAQ:PTRA)

Number of Hedge Fund Holders: 8

Proterra Inc. (NASDAQ:PTRA) is a California-based company that sells commercial vehicles in the United States, the European Union, Canada, Australia, and Japan. The company also provides battery systems and electrification solutions for commercial vehicles such as delivery trucks, school buses, coach buses, and construction and mining equipment, among other applications.

On November 2, Proterra Inc. posted a Q3 revenue of $89.77 million, up 49.9% year-over-year, beating market estimates by $8.73 million. The company maintained its guidance for 2022 revenue of $300 million-$325 million, representing a forecasted growth of between 24%-34% year-over-year, versus a $309.31 million consensus.

BTIG analyst Gregory Lewis initiated coverage of Proterra Inc. on October 17 with a Buy rating and a $7 price target. Proterra Inc. is an American early mover in the commercial electric vehicle market, having distributed its initial vehicles more than a decade ago, the analyst told investors in a research note. The analyst is bullish on Proterra Inc. in light of the passage of the Inflation Reduction Act, which he thinks will boost electric vehicle adoption across the commercial market and elevate demand for Proterra Inc.’s e-transit bus.

According to Insider Monkey’s Q2 data, Cowen Group’s Ramius is the leading position holder in Proterra Inc., with 10.5 million shares worth $49 million. Overall, 8 hedge funds were long Proterra Inc. at the end of the second quarter of 2022.

In addition to Ford Motor Company, General Motors Company, and Rivian Automotive, Inc., Proterra Inc. is one of the best auto stocks to invest in.

9. Lucid Group, Inc. (NASDAQ:LCID)

Number of Hedge Fund Holders: 16

Lucid Group, Inc. (NASDAQ:LCID) was founded in 2007 and is headquartered in Newark, California. It is an automotive company focused on the design and manufacture of electric vehicles, EV powertrains, and battery systems. On October 13, Morgan Stanley analyst Adam Jonas said that Lucid Group, Inc. needs several billion dollars in new capital in FY23 and FY24, but he believes that the company will be able to source the funds to continue innovation and growth. Morgan Stanley also thinks investors should fully appreciate the potential for increased expansion of Lucid Group, Inc.’s relationship with Saudi Arabia and the advantages of having long-term strategic partners.

On September 27, Cantor Fitzgerald analyst Andres Sheppard assumed coverage of Lucid Group, Inc. with an Overweight rating and a $23 price target. The analyst believes Lucid Group, Inc.’s luxury and premium vehicles provide higher efficiency, longer range, quicker charging, and more space compared to its peers. The analyst expects Lucid Group, Inc. to conservatively capture a 2% market share of the Global EV market by 2026.

According to Insider Monkey’s second quarter database, 16 hedge funds were long Lucid Group, Inc., with combined stakes worth $173.7 million, compared to 16 funds in the prior quarter worth $159 million.

8. Stellantis N.V. (NYSE:STLA)

Number of Hedge Fund Holders: 25

Stellantis N.V. (NYSE:STLA) is a Netherlands-based company that designs, manufactures, and distributes commercial and passenger automobiles, engines, transmission systems, metallurgical products, and production systems worldwide. Stellantis N.V. is one of the best auto stocks to monitor.

On November 3, Stellantis N.V. reported a Q3 revenue of $42.1 billion, up 29.1% year-over-year. Global BEV sales increased 41% versus Q3 2021. For FY2022, Stellantis N.V. expects double digit growth in adjusted operating income margin and industrial free cash flow to be positive.

Nomura analyst Anindya Das upgraded Stellantis N.V. on October 20 to Buy from Neutral with a price target of EUR 19.80, up from EUR 15.70. The analyst cited better-than-expected year-to-date net pricing strength in Stellantis N.V.’s primary North America and Europe markets, less risk of margin pressure from EV battery material prices in 2023, and advantages from post-merger platform consolidation in Europe starting in 2023.

According to Insider Monkey’s data, 25 hedge funds were bullish on Stellantis N.V. at the end of June 2022, compared to 29 funds in the earlier quarter. Peter Rathjens, Bruce Clarke, and John Campbell’s Arrowstreet Capital held the largest stake in the company, comprising 37 million shares worth nearly $457 million.

7. NIO Inc. (NYSE:NIO)

Number of Hedge Fund Holders: 25

NIO Inc. (NYSE:NIO) is a Shanghai-based manufacturer of smart electric vehicles in China. The company also provides power solutions, including Power Home, Power Swap, Power Charger, Power Mobile, and Power Map. On November 1, NIO Inc. announced that it delivered 10,059 vehicles in October 2022, up 174.3% from the prior-year quarter. On a year-to-date basis, the company has delivered 92,493 vehicles, up 32% year-over-year. NIO Inc. is one of the premier auto stocks to invest in.

On October 28, Barclays analyst Jiong Shao reiterated an Overweight rating on NIO Inc. but lowered the price target on the stock to $19 from $34. The analyst updated estimates and 12-month price targets for all the Chinese tech and internet companies heading into year-end 2022.

According to Insider Monkey’s data, 25 hedge funds were bullish on NIO Inc. at the end of June 2022, compared to 26 funds in the earlier quarter. Jim Simons’ Renaissance Technologies held the largest position in the company, with 17.8 million shares worth $386 million.

In its Q1 2022 investor letter, Horos Asset Management, an asset management firm, highlighted a few stocks and NIO Inc. was one of them. Here is what the fund said:

“At the beginning of April the CSRC (China Securities Regulatory Commission) announced possible changes in its regulation that would allow this inspection by foreign auditors, provided that the companies previously communicate to this body the state secrets that would be exposed, as well as the sensitive information that they might have to hand over, and the subsequent audit is carried out in a framework of collaboration with the CSRC. In short, a move in the direction desired by the SEC, although still far from the optimal result, that is, unrestricted access to information. While these negotiations between the two regulatory bodies are progressing, Chinese companies have to decide how best to preserve their interests. Other entities, such as the electric vehicle manufacturer NIO Inc., have just started trading on this stock market.”

6. Li Auto Inc. (NASDAQ:LI)

Number of Hedge Fund Holders: 28

Li Auto Inc. (NASDAQ:LI) is a Beijing-based company that designs, manufactures, and sells new energy vehicles in the People’s Republic of China. On November 1, Li Auto Inc. reported that it has delivered 10,052 vehicles in October 2022, up 31.4% year-over-year. On a year-to-date basis, the automaker delivered 96,979 vehicles, up 54.13% year-over-year.

On October 28, investment advisory Barclays maintained an Overweight rating on Li Auto Inc. but lowered the firm’s price target on the shares to $25 from $40. Analyst Jiong Shao issued the ratings update.

According to the second quarter database of Insider Monkey, 28 hedge funds held stakes worth $1.40 billion in Li Auto Inc., compared to 28 funds in the prior quarter worth $1.25 billion. Chase Coleman’s Tiger Global Management is the biggest position holder in the company, with 12.8 million shares valued at $490 million.

Like Ford Motor Company, General Motors Company, and Rivian Automotive, Inc., Li Auto Inc. is one of the favorite auto stocks of elite investors.

5. Ferrari N.V. (NYSE:RACE)

Number of Hedge Fund Holders: 33

Ferrari N.V. (NYSE:RACE) is an Italian automaker that designs, engineers, and sells luxury performance sports cars. On November 2, the company posted Q3 2022 results, reporting a non-GAAP EPS of €1.23, beating market estimates by €0.07. The revenue of €1.25 billion climbed 19.0% on a year-over-year basis, exceeding Wall Street consensus by €50 million. The total shipments of 3,188 units during the third quarter jumped 15.9% compared to the prior-year quarter.

On October 27, investment advisory HSBC upgraded Ferrari N.V. to Buy from Hold. Analyst Edoardo Spina issued the ratings update.

According to Insider Monkey’s data, 33 hedge funds were bullish on Ferrari N.V. at the end of the second quarter of 2022, compared to 31 funds in the last quarter. Anand Desai’s Darsana Capital Partners is the largest position holder in the company, with 1.25 million shares worth $229.35 million.

Here is what Ensemble Capital has to say about Ferrari N.V. in its Q1 2022 investor letter:

“Ferrari (7.3% weight in the Fund): As WE DESCRIBED a year ago in this letter, Ferrari’s chief marketing officer’s hardest job is not getting people to buy a Ferrari, but to tell some of them no. The company is in the business of selling rare, luxury products and so by design they greatly limited the number of vehicles they sell. This extreme constraint has led to a wait list of well over a year with a customer base so devoted to the company that even in the midst of the Financial Crisis of 2008-09, the number of vehicles they sold only declined by 4%. Their customers are so price insensitive, that the company often sells out of their limited edition super cars that sell for millions of dollars before they even announce the price. For a Ferrari collector the high prices are a feature, not a bug, as it is the price that makes Ferrari ownership so exclusive.”

4. Rivian Automotive, Inc. (NASDAQ:RIVN)

Number of Hedge Fund Holders: 35

Rivian Automotive, Inc. is a California-based company that designs, develops, manufactures, and sells electric vehicles and accessories. On October 11, after meeting with company management, Mizuho analyst Vijay Rakesh told investors that Rivian Automotive, Inc.’s vehicle recall is “relatively minor” and that its manufacturing lines have already been updated. The analyst added that the headlines are “worse than reality” and kept a Buy rating on the shares with a $65 price target. Rivian Automotive, Inc. is one of the premier auto stocks to buy now.

According to Insider Monkey’s second quarter database, 35 hedge funds held stakes worth $1.6 billion in Rivian Automotive, Inc., compared to 29 funds in the last quarter worth $4 billion. Philippe Laffont’s Coatue Management is the largest stakeholder of the company, with 18.8 million shares valued at $486 million.

Here is what Baron Fifth Avenue Growth Fund has to say about Rivian Automotive, Inc. in its Q2 2022 investor letter:

“Rivian Automotive, Inc. designs, manufactures, and sells consumer and commercial electric vehicles. Shares of Rivian declined 48.2% in the second quarter as investors continued rotating out of long-duration assets and have become increasingly concerned about capital intensity and cash burn.

At the same time, Rivian continues to be impacted by supply chain issues which are causing delays in its production ramp. Rivian is addressing those challenges by diversifying its supply chain to alleviate shortages while also consolidating the number of variants in development to reduce cash burn (the company guided that current cash will be enough to support the company’s future platform launch ‘R2’ in 2025). Rivian recently reported stronger-than-expected second quarter production numbers while reiterating its annual guidance of producing 25,000 units.

As semiconductor shortages ease, we believe that the company will be able to rapidly ramp its production. We retain conviction in the shares given management’s vision, Rivian’s product positioning, the company’s relationship with Amazon.com, and its strong balance sheet. As of the end of the first quarter, Rivian had $17 billion of cash and cash equivalents, which will help it overcome the current challenges while taking advantage of the long-term opportunity as the market transitions to electric vehicles.”

3. Aptiv PLC (NYSE:APTV)

Number of Hedge Fund Holders: 43

Aptiv PLC (NYSE:APTV) is an Ireland-based company that manufactures and sells electrical, electronic, and safety technology solutions to the automotive and commercial vehicle markets worldwide. On November 3, the company reported its Q3 results, posting a non-GAAP EPS of $1.28 and a revenue of $4.61 billion, topping market estimates by $0.28 and $310 million, respectively. The company expects FY2022 adjusted EPS to be $3.30, versus a consensus of $3.21.

On November 4, Raymond James analyst Brian Gesuale maintained an Outperform rating on Aptiv PLC but lowered the firm’s price target on the shares to $125 from $145. Aptiv PLC’s Q3 results were solid, and management reiterated its outlook for 13% top-line growth and 12% AEBITDA growth for the full year, the analyst told investors in a research note.

According to Insider Monkey’s data, 43 hedge funds were long Aptiv PLC at the end of June 2022, compared to 48 funds in the last quarter. Ian Simm’s Impax Asset Management is the largest stakeholder of the company, with 4.7 million shares worth $417 million.

Here is what ClearBridge Investments Sustainability Leaders Strategy has to say about Aptiv PLC in its Q1 2022 investor letter:

“The acceleration in electrification of transport should support electric vehicle (EV)-related stocks like Aptiv, which came under pressure in the quarter on concerns the auto cycle is past its peak. Aptiv provides a range of solutions for the auto industry, including autonomous driving technologies, safety technologies, components, and wiring. The large exposure of APTV to EVs should lead to long-term value as EVs continue their growth, boosted by their relative attractiveness as prices at the pump hit near-historic highs.”

2. Ford Motor Company (NYSE:F)

Number of Hedge Fund Holders: 46

Ford Motor Company is an American multinational automobile company that commercializes Ford trucks, cars, sport utility vehicles, electrified vehicles, and Lincoln luxury vehicles worldwide. On October 26, Ford Motor Company declared a quarterly dividend of $0.15 per share, in line with previous. The dividend is payable on December 1, to shareholders of the company as of November 15. The forward yield was 4.68%.

On October 27, after a “mostly in-line” quarter from Ford Motor Company and fiscal year guidance for adjusted EBIT that was around $1 billion over his estimate, Morgan Stanley analyst Adam Jonas said that he views Ford’s decision to conclude its Argo robotaxi business as “a positive that investors will appreciate over time.” He maintained an Overweight rating and a $14 price target on Ford Motor Company shares.

Among the hedge funds tracked by Insider Monkey, 46 funds were long Ford Motor Company at the end of Q2 2022, and D E Shaw held a prominent stake in the company, comprising more than 23 million shares worth $257.6 million.

Here is what Leaven Partners has to say about Ford Motor Company in its Q3 2022 investor letter:

“In our last quarterly letter, I briefly mentioned that the consensus estimates for corporate profits appeared to be a bit too sanguine. I referenced a Reuters article that reported, as of June 17, Wall Street expected S&P 500 earnings to grow by 9.6% in 2022, which was up from 8.8% in April and from 8.4% in January. That tune began to change at the end of July and accelerated in August and September, as major players, such as Ford, have recently issued profit warnings and/or have withdrawn guidance. In response, Wall Street has altered its outlook: lowering third-quarter profit growth to 4.6% from 7.2% in early August and slashing full-year profit growth to 4.5%.”

1. General Motors Company (NYSE:GM)

Number of Hedge Fund Holders: 75

General Motors Company is a Michigan-based automaker that sells trucks, crossovers, cars, and automobile parts and accessories in North America, the Asia Pacific, the Middle East, Africa, South America, the United States, and China. It markets its vehicles primarily under the Buick, Cadillac, Chevrolet, GMC, Holden, Baojun, and Wuling brands. General Motors Company is one of the best auto stocks to invest in.

On October 26, JPMorgan analyst Ryan Brinkman raised the price target on General Motors Company to $59 from $58 and reiterated an Overweight rating on the shares following the Q3 beat. General Motors Company reported another quarter of greater than expected total company EBIT and indicated robust execution amidst a wide variety of macroeconomic scenarios over the past few years, the analyst wrote in a research note.

Among the hedge funds tracked by Insider Monkey in Q2 2022, Warren Buffett’s Berkshire Hathaway was the leading stakeholder of General Motors Company, with 52.8 million shares worth $1.7 billion. Overall, 75 hedge funds were bullish on General Motors Company at the end of June 2022.

Here is what Diamond Hill Capital specifically said about General Motors Company in its Q2 2022 investor letter:

“Auto manufacturer General Motors Company was also among our bottom contributors in Q2. Rising interest rates and continued supply chain issues have increased uncertainty surrounding the auto industry, exerting downward pressure on stocks of auto makers. We continue to like GM’s focus on its most profitable market segments (SUV, crossovers, trucks) and believe the company’s heavy investments in autonomous capabilities will position it favorably as the secular movement towards autonomous vehicles continues.”

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