Below is Validea's guru fundamental report for FORD MOTOR CO (F). Of the 22 guru strategies we follow, F rates highest using our Shareholder Yield Investor model based on the published strategy of Meb Faber. This strategy looks for companies returning cash to shareholders via di
Tesla Inc on Sunday said it delivered a record number of vehicles in the second quarter, topping market estimates as price cuts and U.S. federal credits helped make its electric vehicles more affordable.
Despite macro headwinds plaguing many businesses right now, General Motors (NYSE: GM) appears to be on solid footing. The massive car manufacturer, which houses some well-known brands like Chevy, Cadillac, and its namesake GM, is seeing healthy growth. And management is not only
U.S-.based
electric vehicle (EV) maker Rivian Automotive (
NADSAQ:RIVN
) recently joined General Motors (
NYSE:GM
) and Ford (
NYSE:F
) in collaborating with Tesla (
NASDAQ:TSLA
) to adopt the
Elon Musk-led company’s supercharger network.
The news boosted investor sentiment, with Rivian shares rising 23% over the past five days. However, the stock is still down about 10% year-to-date. Wall Street is cautiously optimistic on Rivian due to macro uncertainty, intense competition, and company-specific risks.
Rivian is Facing Multiple Headwinds
Rivian stock has declined significantly from the peak levels seen in November 2021, when it made its public debut. Execution issues, supply chain bottlenecks, competition, and macro pressures impacted the stock’s performance.
Moreover, investors are worried about the significant cash burn, as Rivian continues to invest in production ramp-up. The company’s negative free cash flow increased from $4.4 billion in 2021 to $6.4 billion in 2022. In the first quarter of 2023, Rivian’s negative free cash flow came in at $1.8 billion, up from $1.45 billion in the prior-year quarter.
Rivian currently manufactures R1T pickup trucks, R1S SUVs, and electric delivery vans (EDVs) for Amazon (
NASDAQ:AMZN
) under an agreement to deliver 100,000 EDVs. In the first quarter, the company produced 9,395 vehicles and delivered 7,946 units. A
596% jump in revenue to $661 million helped in lowering the
adjusted loss per share to $1.25 from $1.43 in the prior-year quarter.
While Rivian reaffirmed its full-year production outlook of 50,000 vehicles, critics doubt its ability to meet its target, given the underwhelming performance last year when the company slashed its initial production guidance by half to 25,000 units.
Is Rivian a Buy, Sell, or Hold?
In a research note to investors on June 20,
Mizuho analyst Vijay Rakesh said that Rivian continues to execute well with solid demand and ramping of its Normal, Illinois Facility. However, the analyst lowered his estimates for deliveries in 2024 and 2025, noting “production changeovers” due to the adoption of in-house motor Enduro and lithium iron phosphate (LFP) battery pack.
The analyst noted that Rivian remains focused on being gross margin-positive in 2024, driven by higher volumes, increased pricing, lower raw material costs, and structured contracts with suppliers. Rakesh lowered his price target for
Rivian stock to $27 from $30 and reiterated a Buy rating.
Wall Street’s Moderate Buy consensus rating on Rivian is based on eight Buys, four Holds, and two Sells. The average price target of $21.93 implies nearly 32% upside.
Conclusion
Rivian is confident about producing 50,000 EV units this year. Wall Street’s average price target indicates an attractive upside to the stock. However, concerns over execution, the impact of intense rivalry in the EV space, and macro headwinds could impact investor sentiment for RIVN.
Disclosure
A group of EV charger makers and operators is pushing back against Texas' plan to mandate the inclusion of Tesla technology in charging stations, saying it is "premature," according to a document seen by Reuters and a source aware of the matter.
A group of EV charger makers and operators is pushing back against Texas' plan to mandate the inclusion of Tesla technology in charging stations, saying it is "premature," according to a document seen by Reuters and a source aware of the matter.
Consumer stocks were higher late Friday, with the Consumer Staples Select Sector SPDR Fund (XLP) increasing 1% and the Consumer Discretionary Select Sector SPDR Fund (XLY) adding 1.5%.
Below is Validea's guru fundamental report for FORD MOTOR CO (F). Of the 22 guru strategies we follow, F rates highest using our Shareholder Yield Investor model based on the published strategy of Meb Faber. This strategy looks for companies returning cash to shareholders via di
Ford has found what it described as a major international investor for the U.S. carmaker's German plant in Saarlouis and has signed initial agreements together with the western state of Saarland, it said at a works meeting at the plant on Friday.
The shares of electric-vehicle charging company ChargePoint (US:CHPT) have been tumbling since February amid increasing doubts about the value and strength of electric vehicle charging firms. Moreover, a roster of insiders have been selling their CHPT stock in recent weeks, data
Volkswagen is in talks with Tesla to adopt its North American Charging Standard (NACS), joining a slew of automakers and charging equipment makers that are choosing the technology.
Electrify America, a unit of Volkswagen, said on Thursday it will add Tesla's North American Charging Standard (NACS) connector to its electric vehicle charging network across Canada and the United States by 2025.
Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares Select Dividend ETF (Symbol: DVY) where we have detected an approximate $145.5 million dollar outflow -- that's a 0.7% decrease week over we
Carmaker Stellantis will require union employees to work mandatory overtime at its Warren Truck assembly and Jefferson North factory in Michigan, to boost Jeep SUV production ahead of a potential strike deadline in September, according to a document shared with Reuters.
Despite macro challenges and intense competition,
electric vehicle (EV) adoption continues to rise globally. As per
Counterpoint Research, one in every seven cars sold in the first quarter of 2023 was an EV. Global passenger EV sales grew 32% year-over-year in Q1 2023. Given the concerns over climate change and carbon dioxide emissions, EV sales are projected to witness robust growth in the years ahead. Bearing that in mind, we used
TipRanks’ Stock Comparison Tool to place General Motors (
NYSE:GM
), Tesla (
NASDAQ:TSLA
), and Nio (
NYSE:NIO
) against each other to pick the EV stock with the best upside.
General Motors (NYSE:GM)
Legacy automaker General Motors is rapidly moving ahead with its goal of becoming an all-EV company by 2035. The company aims to build 400,000 EVs in North America from 2022 through the first half of 2024, including 150,000 units this year.
Moreover, GM has secured all battery materials required to grow its capacity to 1 million EVs annually in North America by 2025. While the company is investing aggressively in its EV ambitions, it is also reducing costs in other areas of its operations to improve its profitability. GM is targeting cost reduction of $2 billion by the end of 2024.
Earlier this month,
GM entered into an agreement with Tesla, giving its EV buyers access to the Tesla Supercharger network. The company expects to save up to $400 million through this EV-charging deal with Tesla.
Is GM a Buy, Sell, or Hold?
Following a CFO dinner and factory tour,
Citigroup analyst Itay Michaeli reiterated a Buy rating on
General Motors stock and a price target of $85. Michaeli’s meeting, which included the Factory Zero tour, SuperCruise rides, and EV updates, reinforced his bullish stance on GM.
The analyst sees several potential catalysts over the next six months that could positively influence investor sentiment, including Q2
earnings upside, moderating U.S. pricing and demand concerns in the second half of the year, Ultium EV ramp, and product launches.
Wall Street’s Moderate Buy consensus rating on General Motors is based on six Buys and five Holds. The average price target of $46.90 implies 22.8% upside.
Shares have risen more than 13% so far in 2023.
Tesla (NASDAQ:TSLA)
Tesla stock has skyrocketed 108% so far in 2023, thanks to improved investor sentiment, the company’s competitive position in the EV space, AI-oriented rally in stocks, and key partnerships with players like General Motors, Ford (
NYSE:F
), Rivian (
NASDAQ:RIVN
) involving the
adoption of the company’s North American Charging Standard (NACS).
In fact,
Bernstein analyst Toni Sacconaghi expects supercharging to be a $12 billion opportunity for Tesla in 2030, although he expects the business to carry low margins. Interestingly, Sacconaghi has a Sell rating on Tesla and a price target of $150.
Meanwhile, TSLA has been downgraded by four analysts within the last 10 days due to valuation concerns following a significant rally in the stock and the impact of price cuts and competition on margins.
Is TSLA a Good Stock to Buy?
Ahead of Tesla’s June Delivery report this weekend,
Piper Sandler analyst Alexander Potter reiterated a Buy rating on the stock with a price target of $280. Potter said that he wouldn’t be surprised to see “profit-taking” in the coming months, given TSLA stock’s rally so far this year. The analyst also sees the possibility of operational bottlenecks in the second half of the year.
Potter expects Tesla’s June deliveries to come in at 469,000, although he thinks that his estimate could be a “tad high.” Wall Street’s consensus expectation for June deliveries stands at 445,000. The analyst expects Tesla’s production to be at record levels in the second quarter due to the ramp-up at the Shanghai facility and contributions from Austin and Berlin plants.
Nonetheless, Potter contends that the gross margin outlook will perhaps be even more crucial than production and cautioned that any price cuts in Q3 might reignite worries about the company’s margins.
Wall Street’s Moderate Buy consensus rating on Tesla is based on 13 Buys, 13 Holds, and five Sells. Given the impressive year-to-date rally in the stock, the average price target of $218.58 implies about 15% possible downside.
Nio (NYSE:NIO)
Nio has been struggling with supply chain issues, macro pressures, and intense competition in China, the largest EV market in the world. The company’s underwhelming
first-quarter performance and weak second-quarter guidance added to investors’ woes. Succumbing to the price wars in China and in a bid to boost sales, Nio recently lowered the prices for its EVs by RMB 30,000. Nio has also decided to stop offering free battery-swapping services to buyers.
The company’s Q2 deliveries outlook indicates a decline in the range of 0.2% to 8.2%, partly due to lower production in April and May, as the company transitioned its production lines to its NT2.0 platform.
Is Nio Stock a Buy, Sell, or Hold?
Following Nio’s weak Q2
revenue guidance,
Mizuho analyst Vijay Rakesh reiterated a Buy rating on the stock and lowered the price target to $20 from $25 on June 9. Rakesh also lowered his delivery estimates to about 152,000 units from 207,000 for 2023 and to 259,000 from 283,000 for 2024.
Despite short-term headwinds, Rakesh remains bullish on Nio due to several upcoming production ramp-ups, including the low-cost ES6 SUV, a multi-year EV adoption tailwind, and the company’s leadership in the premium EV segment in China. He is also optimistic about Nio’s expansion in Europe and other regions and a growing product portfolio.
With seven Buys and four Holds, Nio earns a Moderate Buy consensus rating. The average Nio price target of $10.33 implies 8.51% upside.
Shares are down over 2% year-to-date.
Conclusion
Wall Street is cautiously optimistic about GM, TSLA, and NIO due to macro uncertainty and growing competition. Currently, analysts see higher upside in General Motors, with the company taking the right steps to accelerate its EV goals and improve profitability.
Disclosure
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