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Just a few short years ago, investors ran vigorously in the opposite direction from U.S. auto stocks. Yet, fast forward to today and you're likely to see much brighter news - and higher auto company share prices. One automaker in particular, Ford (NYSE:F), could provide an excellent value for investors in terms of both income and growth.

In fact, strong August 2012 sales have actually made the auto industry a bright spot in what is otherwise considered to be a mediocre economy across the board. In just that month alone, Ford reported a 13% increase in sales, with GM close behind at 10%. And, this upward momentum is expected to continue, based on a slightly higher sales estimate put out by the Bureau of Economic Analysis.

In August 2012, Ford sold a total of nearly 200,000 vehicles, with the Ford Escape leading the pack at over 28,000 units. This equates to a 37% sales increase for just this sport utility vehicle alone. Other sales leaders included the Ford Fusion with nearly 21,700 units sold and a 21% increase in sales, and the Ford F-Series with a 19% increase in sales and more than 58,200 units sold.

The only real downer for Ford was the company's Fiesta model, with approximately 4,200 units sold and a decrease in sales of 28% over the previous month. According to Ford's vice president of U.S. marketing, the drop in Fiesta sales is likely due in large part to the fact that customers typically come into a Ford showroom to see the Fiesta, yet ultimately end up purchasing the Focus model instead.

With a market cap of nearly $38.5 billion, Ford shares currently possess earnings per share of nearly 4.5, and a P/E ratio of roughly 2.3. The company's shares are estimated to rise nearly 34% over the next 12 months.

General Motors (NYSE:GM) is not far behind Ford in terms of sales increases and positive momentum. The auto maker's August sales totaled over 240,500 vehicles, giving a rise of over 10% compared with July. This makes August the best month of 2012 for GM year to date.

GM posted a rise in sales on all four of its brands for the month of August, with GMC up 4%, both Cadillac and Chevrolet up 11% each, and Buick up 12%. In fact, August represents the best sales month of 2012 for the Buick brand, which is actually on track to have its best retail sales year since before the recession.

The company's fleet sales were also up by 6% compared with the previous month. As GM advertised heavily during the July 2012 Olympics - especially its Volt, Sonic, Spark and Cruze models - all of these GM vehicles also set monthly sales records in the month of August.

With a market cap of just under $37 billion, GM posts an earnings per share of a tad over 2.8, and a P/E ratio of near 8.4. The company's shares are estimated to rise nearly 30% over the next 12 months.

Overseas, Japanese auto makers are also reporting a nice increase in sales. Toyota (NYSE:TM) sales rose 26% in August over the same month last year. One of the biggest reasons for this was because of supply shortages in 2011 due to the country's natural disaster.

Toyota has not been without its problems. Recently, the company cited accusations that a former employee sabotaged computer applications and stole proprietary data from the firm. Although no information has actually leaked as of yet, should that occur in the future, it could prove to be highly damaging to the automaker, as well as to its suppliers.

This alone could cause the share price to drop - possibly significantly - depending on the extent of the damage. Currently, Toyota's shares offer a dividend yield of 1.2% and trade at just over 17 times trailing earnings.

Not to be overlooked is Honda (NYSE:HMC) - especially as American Honda Motor Company has announced its pledge to be more socially responsible in terms of environment, community, education and diversity.

Honda possesses a market cap of over $58 billion. The company reported sales in excess of $111 billion over the past 12 months, giving it a net profit margin of just under 2.7%. It currently provides investors with a dividend yield of nearly 2.55%.

The news, however, is not so bright for Tesla Motors (NASDAQ:TSLA). The company recently announced that if it does not raise the anticipated proceeds from an upcoming additional share offering, it is possible that it may not be compliant with the necessary current ratio covenant for the quarterly period that ends on March 31, 2013.

In addition, the company has also stated that without additional revenue opportunities and/or adjustments in company spending, it is likely that Tesla will need to seek an amendment from the DOE in order to modify the fixed charge coverage ratio covenant, as well as a possible amendment in order to make a modification to the total liabilities to shareholder equity for the quarter that will end as of March 31, 2014. With this in mind, investors will definitely want to shy away from Tesla for both the short- and long-term horizon.

The Bottom Line

Given the current good news by U.S. auto makers, now may be the perfect time to own shares of Ford. With positive share growth expectations, a majority of analysts have rated the stock as either a Buy or Strong Buy, and I tend to agree.

Good news abounds for Ford, which has recently set sales records on several of its vehicle models. I believe the share price will rise over 30% by 2014. Investors can expect a nice boost of growth, especially if shares can be picked up in the $10 range.

Source: Ford: Buy At $10 And Ride 30% Higher By 2014