General Motors And Ford Motor Trade At Multi-Month Lows Ahead Of June 2012 Sales

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Includes: F, TM
by: Selerity Research

By Brendan Gilmartin

The leading automakers are scheduled to report monthly sales on Tuesday, July 3.

Summary: The leading automakers are scheduled to report June 2012 auto sales on Tuesday, July 3. The data and analytics providers remain fairly upbeat on the group, with June 2012 sales expected to reflect solid year-over year growth. Despite the upbeat sales prospects, however, shares of Ford (NYSE:F) and General Motors (NYSE:GM) have come under pressure, succumbing to 7-month lows on concerns over the macroeconomic backdrop, particularly in Europe.

  • According to TrueCar.com, new light vehicle sales for June 2012 in the U.S. are expected to rise 18.1% from the year ago period and represent the highest level since June 2007. However, uncertainty in the financial markets and recent economic slowdown recently pressured selling rates.
  • Edmunds.com reported that June sales more likely picked up toward the end of the month after a sluggish start. The firm expects June 2012 to be the highest selling month since May 2008 but that the top automakers will report lower month/month sales.
  • Kelley Blue Book reported that June sales may have benefited from consumers seeking replacement vehicles.

Ford Motor: Expected Release Time: 9:30 a.m. EST

Overview: Ford is scheduled to report June sales at approximately 9:30 a.m. EST. The shares have come under pressure in recent weeks, culminating in a steep sell-off on June 29 after cautioning that 2Q sales and earnings in Europe would fall well shy of previous forecasts. Estimates call for a low single-digit y/y improvement in comes for June. A negative reading could have steep negative consequences.

Technical Review: Ford shares recently slid to the lowest level since last November, breaking below the 200-Week SMA near $10 along the way. The Relative Strength Index is also hovering just above 30 - a level that typically implies oversold conditions. (Chart courtesy of StockCharts.com)

Estimates

TrueCar.com: 0.30% (Source: Truecar.com)

Edmunds.com: 4.40% (Source: Edmunds.com)

Kelley Blue Book: 1.40% (Source: KBB.com)

General Motors: Expected Release Time: 10:00 a.m. EST

Overview: General Motors is due to report its June sales at approximately 10:00 a.m. EST. Evidence of slowing sales in Europe and the global macro backdrop have contributed to the recent pullback in GM shares. The forecasts for June 2012 sales range from 6% - 9%. Anything less would prove disappointing.

Technical Review: GM shares are trading at the lowest level since last December, resulting in a bullish "Triple-Bottom" formation, using the previous October lows. The Relative Strength Index is also well below the 30-level, implying the shares are oversold in the near-term. (Chart courtesy of StockCharts.com)

Estimates

TrueCar.com: 6.00% (Source: Truecar.com)

Edmunds.com: 8.70% (Source: Edmunds.com)

Kelley Blue Book: 7.30% (Source: KBB.com)

Toyota Motor (NYSE:TM): Expected Release Time: 10:30 a.m. EST

Overview: Toyota Motor will post its monthly sales report between 10:00 a.m. and 2:00 p.m. Sales are seen rising between 66% and 68% y/y as the country rebounds from the March 2011 earthquake and tsunami. Strong sales of the Camry and the Prius are expected to boost June 2012 sales.

Technical Review: Toyota ADRs are rallying in advance of what is expected to be a solid June selling period, with the shares surging back above the 50-Day SMA. The momentum is also evident by the rising Relative Strength Index (RSI) and upward-sloping MACD. (Chart courtesy of StockCharts.com)

Estimates

TrueCar.com: 67.9% (Source: Truecar.com)

Edmunds.com: 66.3% (Source: Edmunds.com)

Kelley Blue Book: 67.9% (Source: KBB.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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