By, Brendan Gilmartin
The leading automakers are scheduled to report monthly sales on Tuesday, May 1.
Summary: The leading automakers are scheduled to report monthly auto sales on Tuesday, May 1. Several factors appear to suggest April could be a solid month, thanks in part to improved consumer sentiment in the U.S., favorable weather conditions, and a push toward more fuel efficient vehicles. Some analysts predict the April sales reports may be among the strongest since 2007.
According to TrueCar.com, the strong sales in the first quarter, stemming from the recovering U.S. economy and product choices, appears to have carried over into April. Demand for smaller, fuel efficient vehicles continues to support higher sales for April.
According to a report on Edmunds.com, an increase in consumer sentiment and favorable weather across many parts of the U.S. helped boost April Auto sales. Overall, Edmunds.com estimates that 1,181,929 new cars were sold in April, down 15.8% from March 2012 but up 2.1% y/y. The firm also raised its 2012 auto sales forecast based on strong sales to date.
According to Kelley Blue Book, April sales should benefit from consumers seeking to replace aging vehicles, a slight improvement in the U.S. economic backdrop, and new product introductions.
General Motors (GM) Expected Release Time: 10:00 a.m. EST
Overview: GM is due to report its April sales at approximately 10:00 a.m. EST. According to Edmunds.com, GM is expected to see the biggest m/m improvement in market share, estimated to reach 18.2%, up 1.8% from the prior month. Rising fuel prices are expected to drive sales of more efficient vehicles.
- TrueCar.com: -10.0% (Source: http://www.truecar.com)
- Edmunds.com: -7.3% (Source: www.edmunds.com)
- Kelley Blue Book: -14.6% (Source: www.kbb.com)
Technical Review: GM shares have come under pressure of late, slipping below the 200-Day SMA (~$24.00) for the first time in over two months. Should sales surprise to the upside, look for initial resistance at the 50-Day SMA near $25.00, followed by $26.00. Support is at $23.00, with downside risk to $22.00. (Chart courtesy of StockCharts.com)
Ford Motor (F) Expected Release Time: 9:30 a.m. EST
Overview: Ford is scheduled to report April sales at approximately 9:30 a.m. EST. An improvement in pick-up sales and steady performance for SUVs are expected to help support monthly results. Despite improving financial conditions and a strengthening balance sheet, however, Ford shares have come under pressure ahead of the monthly sales report.
- TrueCar.com: -3.9% (Source: http://www.truecar.com)
- Edmunds.com: -6.5% (Source: www.wedmunds.com)
- Kelley Blue Book: -5.4% (Source: www.kbb.com)
Technical Review: Ford shares recently broke below a narrow trading channel between $12.25 and $13.00 established earlier this year. Ford shares are currently hovering just above the 200-Day SMA near $11.50 - a level going back to early December. This will be a key near-term support level. Resistance is at the low end of the aforementioned trade channel near $12.00. (Chart courtesy of StockCharts.com)
Toyota Motor (TM) Expected Release Time: 1:30 p.m. EST
Overview: Toyota Motor will post its monthly sales report between 1:00 p.m. and 2:00 p.m. The shares recently climbed to the highest level since the devastating earthquake and tsunami that struck Japan in March, 2011. According to TrueCar.com, Toyota has recovered from inventory shortages and lost market share resulting from the March 2011 earthquake and tsunami. The firm is looking for Toyota to report its strongest monthly sales since December 2010.
- TrueCar.com: 14.8% (Source: http://www.truecar.com)
- Edmunds.com: 9.60% (Source: www.wedmunds.com)
- Kelley Blue Book: 2.9% (Source: www.kbb.com)
Technical Review: Toyota shares are just off the recent 52-week high in advance of what is expected to be a solid monthly sales report. Should the numbers disappoint, look for support near the recent lows around $80. There is little near-term resistance at current levels up to the March highs near $87. (Chart courtesy of StockCharts.com)
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
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