Ford Motor Company (F): This Auto Stock Is Ridiculously Cheap

Toyota’s performance is due to a weaker yen, as Toyota’s stock activity and yen depreciation are positively correlated, and also because of Toyota’s expertise in manufacturing vehicles under its kaizen philosophy, which is so efficient that once Ford Motor Company (NYSE:F) CEO Alan Mulally cited Toyota as a model of how Ford should operate.

Regardless of the current share price, Toyota is a well respected brand among car buyers and has reported a massive increase in operating income for this year ($13.7 billion from $3.8 billion last year). This is partly because of a more favorable exchange rate and partly because of its intrinsic brand popularity and global efforts to reduce its cost base. Therefore, Toyota is worth watching closely. It may be too expensive now, but a correction could be seen as a buying opportunity in the next months.

The bottom line

I believe Ford Motor Company (NYSE:F) is a clear example of a stock that remains well undervalued after the financial crisis, despite having improved its fundamentals consistently. In the short run, the latest earnings calls show us that Ford is selling more both in America and in the emerging markets.

In the long run, Ford is committed to the only thing that matters: making better cars. Add to this the low current P/E ratio, an attractive dividend (unlike General Motors Company (NYSE:GM)) and a strong brand in China (where Toyota Motor Corporation (ADR) (NYSE:TM) finds it hard to sell cars), and you have a great investment opportunity to consider.

The article This Auto Stock Is Ridiculously Cheap originally appeared on Fool.com.

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