5 Most Undervalued Auto Stocks According To Hedge Funds

1. General Motors Company (NYSE:GM)

Number of Hedge Fund Holders: 74

P/E Ratio as of January 19: 6.01

General Motors Company (NYSE:GM) is a Michigan-based company that designs, manufactures, and sells trucks, crossovers, cars, automobile parts, and accessories in North America, the Asia Pacific, the Middle East, Africa, South America, the United States, and China. General Motors Company (NYSE:GM) is one of the most undervalued auto stocks according to smart investors. The company announced that it delivered 2.2 million vehicles in the United States in 2022, surpassing Toyota Motor Corporation. Heading into 2023, the automaker expects EV sales to rise meaningfully and promote continued growth.

On January 19, Deutsche Bank analyst Emmanuel Rosner maintained a Hold rating on General Motors Company (NYSE:GM) but lowered the firm’s price target on the shares to $33 from $35. The analyst expects a mixed Q4 earnings and 2023 guidance season for U.S. autos, with multiple companies potentially falling short of quarterly consensus estimates, and most of them likely to issue cautious 2023 guidance amid volatile industry conditions and macro uncertainty.

According to Insider Monkey’s data, 74 hedge funds were long General Motors Company (NYSE:GM) at the end of the third quarter of 2022, compared to 75 funds in the prior quarter. Warren Buffett’s Berkshire Hathaway is the largest position holder in the company, with 50 million shares worth $1.60 billion. 

Here is what Diamond Hill Capital had to say about General Motors Company (NYSE:GM) in its Q3 2022 investor letter:

“Most recently, we initiated a position in General Motors Company (NYSE:GM), one of the largest automakers in the United States. Over the past several years, GM has taken steps necessary to focus the company on the most profitable segments and move into position to compete in an electrified and autonomous world. With the recent rise in interest rates there was a meaningful selloff in the auto industry, which presented us with an attractive entry point to a name we know well.”

Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily enewsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below. You can also check out Dividend Aristocrats Ranked: Top 15 and 12 Best DRIP Stocks To Own.