In this article, we will look at the 13 Best Automotive Stocks to Buy According to Hedge Funds.
On August 25, CNBC’s Phil LeBeau appeared on CNBC’s ‘Power Lunch’ to talk about the hiking automotive prices and the reason behind this trend.
He stated that auto prices are continuing to rise, and it is the upper end of the market that is experiencing the most growth. He corroborated this claim with data from Cox Automotive looking at the increase in prices of automotives and the willingness of buyers to purchase them.
The data showed that the percentage of new car sales over $50,000 was 25.5% in 2019, rising to 44.2% in 2025.
Similarly, the percentage of new car sales over $60,000 rose from 7.0% in 2019 to 27.1% in 2025, while that of over $70,000 grew from 3.9% in 2019 to 14.1% in 2025. The average new auto transaction price, according to the data, stood at $48,841.
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LeBeau reasoned that this started during the chip crisis: when automakers were restricted in the number of semiconductors they could get, they prioritized making the most profitable vehicles as smart business operators. These included the higher-priced and higher-end vehicles, which sold primarily because there was a limited supply out there.
He thus stated that this trend marked the beginning of the shift within the market. The reality, according to LeBeau, is that the automakers are in this business to make money, and with higher-income households buying a greater percentage of vehicles, the market has shifted to the upper end.
With these trends in view, let’s look at the best automotive stocks to buy according to hedge funds.
Our Methodology
We used stock screeners to compile a list of top automotive stocks and chose the top 13 most popular among hedge funds as of Q2 2025. We sourced the hedge fund sentiment data from Insider Monkey’s database. The list is sorted in ascending order of hedge fund holders.
Note: All data was sourced on September 2.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
13 Best Automotive Stocks to Buy According to Hedge Funds
13. Stellantis N.V. (NYSE:STLA)
Number of Hedge Fund Holders: 28
Stellantis N.V. (NYSE:STLA) is one of the best automotive stocks to buy according to hedge funds. In a report released on August 28, Thomas Besson from Kepler Capital maintained a Buy rating on Stellantis N.V. (NYSE:STLA), setting a price target of €12.00.
Stellantis N.V. (NYSE:STLA) reported financial results for the first half of 2025 on July 29, with net revenues of €74.3 billion, down 13% compared to H1 2024.
The drop was primarily driven by year-over-year declines in North America and enlarged Europe, partially offset by growth in South America.
The company also reported a net loss of €2.3 billion, which includes €3.3 billion of net charges excluded from adjusted operating income, down compared to the first half of 2024. Stellantis N.V. (NYSE:STLA) also reported net profit of €5.6 billion.
Stellantis N.V. (NYSE:STLA) designs, manufactures, distributes, and sells vehicles. The company offers products under various brands, including Abarth, Alfa Romeo, Chrysler, Citroën, Dodge, DS, Fiat, Fiat Professional, Jeep, Lancia, Opel, Peugeot, Ram, and Vauxhall.
12. Asbury Automotive Group, Inc. (NYSE:ABG)
Number of Hedge Fund Holders: 30
Asbury Automotive Group, Inc. (NYSE:ABG) is one of the best automotive stocks to buy according to hedge funds. On August 14, Morgan Stanley raised the firm’s price target on Asbury Automotive Group, Inc. (NYSE:ABG) to $230 from $225, keeping an Equal Weight rating on the shares.
The firm told investors that the intra-quarter data is continually reflecting stability in auto and consumer data, and dealers are well-positioned to continue to deliver on earnings into H2.
Similarly, Stephens analyst Jeff Lick upgraded Asbury Automotive Group, Inc. (NYSE:ABG) to Overweight from Equal Weight on August 13, raising the price target to $277 from $225.
The firm told investors that after spending two weeks integrating the Chambers acquisition into its model, it concluded that the company has $35+ in 2028 EPS power based on the items under its control and assets currently on its balance sheet.
Asbury Automotive Group, Inc. (NYSE:ABG) is a franchised automotive retailer. The company’s operations are divided into the Dealerships and Total Care Auto (TCA) segments.
11. Genuine Parts Company (NYSE:GPC)
Number of Hedge Fund Holders: 38
Genuine Parts Company (NYSE:GPC) is one of the best automotive stocks to buy according to hedge funds. In a report released on August 27, Scot Ciccarelli from Truist Financial maintained a Buy rating on Genuine Parts Company (NYSE:GPC) without assigning a price target.
Genuine Parts Company (NYSE:GPC) reported its fiscal Q2 2025 results on July 22, with sales for the quarter reaching $6.2 billion and a diluted EPS of $1.83.
The company also revised its fiscal 2025 outlook, with revenue growth of 1% to 3% from 2% to 4%, and adjusted diluted EPS of $7.50 to $8.00 from $7.75 to $8.25.
Genuine Parts Company (NYSE:GPC) is involved in the distribution of automotive and industrial replacement parts. The company’s operations are divided into the following segments: Automotive Parts Group, Industrial Parts Group, and Corporate.
10. Rivian Automotive, Inc. (NASDAQ:RIVN)
Number of Hedge Fund Holders: 38
Rivian Automotive, Inc. (NASDAQ:RIVN) is one of the best automotive stocks to buy according to hedge funds. In a report released on August 30, Chris Pierce from Needham reiterated a Buy rating on Rivian Automotive, Inc. (NASDAQ:RIVN) with a price target of $14.00.
Rivian Automotive, Inc. (NASDAQ:RIVN) reported its fiscal Q2 2025 results on August 5, announcing that it received a $1 billion equity investment from Volkswagen Group on June 30 at an effective price of $19.42, representing a “33% premium to the $14.56 30-trading day volume-weighted average stock price.”
Management stated that the investment is a part of the up to $5.8 billion agreement associated with the Volkswagen Group Technology and Rivian Automotive, Inc.’s (NASDAQ:RIVN) joint venture.
Rivian Automotive, Inc. (NASDAQ:RIVN) produced 5,979 vehicles at its manufacturing facility in Normal, Illinois, in fiscal Q2 2025 and delivered 10,661 vehicles.
Rivian Automotive, Inc. (NASDAQ:RIVN) designs, develops, and manufactures category-defining electric vehicles and accessories. Its operations are divided into the following segments: Automotive, Software, and Services.
9. Group 1 Automotive, Inc. (NYSE:GPI)
Number of Hedge Fund Holders: 40
Group 1 Automotive, Inc. (NYSE:GPI) is one of the best automotive stocks to buy according to hedge funds. On August 14, Morgan Stanley analyst Daniela Haigian raised the firm’s price target on Group 1 Automotive, Inc. (NYSE:GPI) to $485 from $470, keeping an Overweight rating on the shares.
The firm is remaining selective with “best-in-class operators,” and recognizes that the year-to-date stock price appreciation shows an investor base that has “priced in this earnings resiliency.”
However, on August 5, JPMorgan analyst Rajat Gupta raised the firm’s price target on Group 1 Automotive, Inc. (NYSE:GPI) to $425 from $415 while keeping a Neutral rating on the shares.
The firm told investors that it adjusted targets in the auto dealership group after the Q2 report and adopted a less negative stance on the sector due to improving organic growth.
Group 1 Automotive, Inc. (NYSE:GPI) operates in the automotive retailing industry and sells used and new cars and light trucks. It also sells vehicle parts, provides automotive maintenance and repair services, and sells service contracts. The company’s operations are divided into the United States and the United Kingdom geographical segments.
8. Ferrari N.V. (NYSE:RACE)
Number of Hedge Fund Holders: 43
Ferrari N.V. (NYSE:RACE) is one of the best automotive stocks to buy according to hedge funds. On September 1, RBC Capital analyst Tom Narayan maintained a Buy rating on Ferrari N.V. (NYSE:RACE) and set a price target of €475.00.
Ferrari N.V. (NYSE:RACE) reported net revenues of Euro 1,787 million in its fiscal Q2 2025 results, up 4.4% versus the prior year, with total shipments of 3,494 units.
Operating profit for the quarter rose 8.1% to Euro 552 million, with an operating profit margin of 30.9%.
Ferrari N.V. (NYSE:RACE) also reported an EBITDA of Euro 709 million, up 5.9% compared to the prior year, with an EBITDA margin of 39.7%.
Management stated that there was no significant effect of the introduction of new import tariffs on EU cars into the US in the quarter.
Ferrari NV (NYSE:RACE), more commonly known as Ferrari, is an Italy-based manufacturer, designer, and retailer of luxury sports cars. It also produces one-off and limited-series cars and operates under the Ferrari brand.
The company has a wide range of cars and operates actively in more than 60 markets across the globe through a network of authorized dealers.
7. AutoNation, Inc. (NYSE:AN)
Number of Hedge Fund Holders: 45
AutoNation, Inc. (NYSE:AN) is one of the best automotive stocks to buy according to hedge funds. On August 14, Morgan Stanley raised the firm’s price target on AutoNation, Inc. (NYSE:AN) to $220 from $195, keeping an Overweight rating on the shares.
The firm told investors that the intra-quarter data continues to reflect stability in auto and consumer data. It reiterated auto retail as its “favorite” vertical within Autos.
However, Guggenheim lowered the firm’s price target on AutoNation, Inc. (NYSE:AN) to $228 from $230 on August 11, while keeping a Buy rating on the shares.
The analyst told investors in a sector note that while concerns exist about how the group would trade into an SAAR slowdown, factors such as positive inflection in sales in July and the recent pullback in the group, help “de-risk the near-term setup.”
AutoNation, Inc. (NYSE:AN) provides automotive products and services, with its operations divided into the following segments: Domestic, Import, Premium Luxury, and Corporate & Other.
6. Lithia Motors, Inc. (NYSE:LAD)
Number of Hedge Fund Holders: 47
Lithia Motors, Inc. (NYSE:LAD) is one of the best automotive stocks to buy according to hedge funds. On August 22, Benchmark Co. analyst Michael Albanese reiterated a Buy rating on Lithia Motors, Inc. (NYSE:LAD) and set a price target of $400.00.
However, on August 11, Guggenheim lowered the firm’s price target on Lithia & Driveway to $380 from $383, while keeping a Buy rating on the shares.
The firm told investors in a sector note that while a number of auto dealers reported Q2 earnings that surpassed consensus expectations, the reactions remained generally negative despite the strong results.
It added that while concerns exist about how the group would trade into an SAAR slowdown, positive inflection in sales in July and the recent pullback in the group may help “de-risk the near-term setup.”
Lithia Motors, Inc. (NYSE:LAD) operates as a global automotive retailer that offers a wide range of products and services throughout the vehicle ownership lifecycle. The company retails new and used vehicles and also offers other services, including captive finance solutions, comprehensive fleet management services, and other synergistic adjacencies. Its operations are divided into the Vehicle Operations and Financing Operations segments.
5. CarMax, Inc. (NYSE:KMX)
Number of Hedge Fund Holders: 54
CarMax, Inc. (NYSE:KMX) is one of the best automotive stocks to buy according to hedge funds. On August 25, CarMax, Inc. (NYSE:KMX) announced the launch of a new brand positioning, bringing the spotlight to its industry-leading omnichannel experience.
Management reported that the company is now setting a new standard for the car purchasing journey, integrating customer empowerment at every step.
The company’s brand is retiring from its former tagline, which has been in use in one form or another for over 20 years, and is introducing a new “Wanna Drive?” tagline in its latest creative spots.
In partnership with creative agency 72andSunny Los Angeles, the new tagline reflects the modern expression of what CarMax, Inc. (NYSE:KMX) stands for at present and brings the customer-centric experience to life.
CarMax, Inc. (NYSE:KMX) is involved in the retail of used vehicles and wholesale of vehicle auction operators. The company’s operations are divided into the CarMax Sales Operations and CarMax Auto Finance (CAF) segments.
The CarMax Sales Operations segment encompasses all aspects of the company’s auto merchandising and service operations, while the CAF segment manages its finance operation, offering vehicle financing services to customers purchasing retail vehicles.
4. O’Reilly Automotive, Inc. (NASDAQ:ORLY)
Number of Hedge Fund Holders: 62
O’Reilly Automotive, Inc. (NASDAQ:ORLY) is one of the best automotive stocks to buy according to hedge funds. In a report released on August 13, Steven Shemesh from RBC Capital maintained a Buy rating on O’Reilly Automotive, Inc. (NASDAQ:ORLY), setting a price target of $111.00.
Similarly, Argus Research initiated coverage on O’Reilly Automotive, Inc. (NASDAQ:ORLY) with a Buy rating on the same day, setting a $120.00 price target.
In another report released on August 12, Greg Melich from Evercore ISI maintained a Buy rating on O’Reilly Automotive, Inc. (NASDAQ:ORLY) with a price target of $110.00.
The stock’s median price target of $103.68 implies an upside of 6.10% from current levels.
O’Reilly Automotive, Inc. (NASDAQ:ORLY) owns and operates retail outlets in the US and is involved in the distribution and retailing of automotive aftermarket parts, supplies, tools, equipment, and accessories.
The company offers new and remanufactured automotive hard parts to both professional installers and do-it-yourself customers, including water pumps, fuel pumps, alternators, temperature controls, brake system components, and more.
3. AutoZone, Inc. (NYSE:AZO)
Number of Hedge Fund Holders: 65
AutoZone, Inc. (NYSE:AZO) is one of the best automotive stocks to buy according to hedge funds. On August 18, Evercore ISI raised the firm’s price target on AutoZone, Inc. (NYSE:AZO) to $4,250 from $4,060 while keeping an Outperform rating on the shares.
The firm told investors in a retail earnings preview note that the timing of the Trump 2.0 policies caused uncertainties in the Q2 earnings season for large-cap retailers.
However, it added that Q2 was “generally” solid, with limited price elasticity and early tariff pass-through allowing nominal demand to hold up.
AutoZone, Inc. (NYSE:AZO) is involved in the retail and distribution of automotive replacement parts and accessories. The company’s operations are divided into the Auto Part Stores and Other segments.
2. Carvana Co. (NYSE:CVNA)
Number of Hedge Fund Holders: 91
Carvana Co. (NYSE:CVNA) is one of the best automotive stocks to buy according to hedge funds. On August 25, Citizens JMP analyst Andrew Boone reiterated a buy rating on Carvana Co. (NYSE:CVNA) with a $460 price target.
Similarly, Bank of America Securities analyst Mike McGovern maintained a bullish stance on the stock on August 20, setting a price target of $425. The same day, Citi analyst Ronald Josey reiterated a Buy rating on Carvana Co. (NYSE:CVNA) with a $490 price target.
However, Evercore ISI analyst Michael Montani reiterated a Hold rating on the stock on August 12, while raising the price target from $365 to $370.
The stock’s median price target of $371.92 implies an upside of 14.27% from current levels.
Headquartered in Tempe, AZ, Carvana Co. (NYSE:CVNA) is an e-commerce platform and a holding company involved in the buying and selling of used cars.
1. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 115
Tesla, Inc. (NASDAQ:TSLA) is one of the best automotive stocks to buy according to hedge funds. Piper Sandler analyst Alexander Potter maintained a Buy rating on Tesla, Inc. (NASDAQ:TSLA) on August 29, setting a price target of $400.00.
The stock also received a Buy rating from Morgan Stanley’s Adam Jonas in a report issued on August 26. However, GLJ Research reiterated a Sell rating on Tesla, Inc. (NASDAQ:TSLA) on August 21.
Tesla, Inc. (NASDAQ:TSLA) reported on July 2 that it produced over 410,000 vehicles in Q2, delivering more than 384,000 vehicles and deploying 9.6 GWh of energy storage products.
Tesla, Inc. (NASDAQ:TSLA) designs, manufactures, and sells high-performance electric vehicles and energy generation and storage systems. It operates through two segments: energy generation and storage, and automotive.
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