JPMorgan has some strong views on General Motors (NYSE:GM), Ford (NYSE:F) and Tesla (NASDAQ:TSLA) as the automakers close in on their Q1 earnings disclosures. GM and Ford report next week, while Tesla spills numbers the first week of May. Snippets from JP's analysis is posted below (via Barron's)
General Motors (Outperform, $48 PT): "We estimate GM global production was stronger than expected in 1Q, rising +3% y/y vs. our prior forecast for a -1% decline... Production tracked better than expected across most regions."
Ford (Outperform, $15 PT, Q1 EPS $0.35): "In North America, while GM has faced seeming price headwinds on older model vehicles, our sense is that Ford is enjoying relatively stronger pricing, on benefit of the new Ford Super Duty pickup truck, which continues to transact at higher than expected ATPs for this point in its product lifecycle."
Tesla (Underweight, $185 PT): "We are updating our model for the higher than expected deliveries in 1Q17 (25,000 units vs. JPM of 24,000), higher share count post the recent equity raise, and expectation for higher than previously modeled operating expenses. The confluence of the above items lowers our 2017 EPS estimate to a loss or -$0.71 in 2017."
The three price targets from JPMorgan suggest a great deal of volatility this year as a variety of industry-disrupting factors play out. By the end of the year, variables such as the adjusted border tax, Model 3 timeline, China EV demand, sale of Opel, Ford's mobility push, Bolt reception and U.S. SAAR trends will be clearer.
Related ETF: CARZ.
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