5 Best Auto Stocks To Buy Now

In this article, we discuss 5 best auto stocks to buy now. If you want to see more stocks in this selection, check out 10 Best Auto Stocks To Buy Now. 

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. (NYSE:RACE) 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. (NYSE:RACE) 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. (NYSE:RACE) 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. (NASDAQ:RIVN) 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. (NASDAQ:RIVN)’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. (NASDAQ:RIVN) 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. (NASDAQ:RIVN), 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. (NASDAQ:RIVN) 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 (NYSE:APTV) but lowered the firm’s price target on the shares to $125 from $145. Aptiv PLC (NYSE:APTV)’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 (NYSE:APTV) 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 (NYSE:APTV) in its Q1 2022 investor letter:

“The acceleration in electrification of transport should support electric vehicle (EV)-related stocks like Aptiv (NYSE:APTV), 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 (NYSE:F) 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 (NYSE:F) 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 (NYSE:F) 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 (NYSE:F) shares.

Among the hedge funds tracked by Insider Monkey, 46 funds were long Ford Motor Company (NYSE:F) 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 (NYSE:F) 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 (NYSE:F), 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 (NYSE:GM) 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 (NYSE:GM) 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 (NYSE:GM) to $59 from $58 and reiterated an Overweight rating on the shares following the Q3 beat. General Motors Company (NYSE:GM) 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 (NYSE:GM), with 52.8 million shares worth $1.7 billion. Overall, 75 hedge funds were bullish on General Motors Company (NYSE:GM) at the end of June 2022. 

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

“Auto manufacturer General Motors Company (NYSE:GM) 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.”

You can also take a look at Best Biotech Stocks Under $10 and Growth Stock Portfolio: Hedge Funds’ Top Picks. 

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