Ford is a buy; recent upgrades reflect positive dynamics like reduced EV mandates and truck demand, despite low single-digit valuation multiples typical for autos.

Ford Motor Company and General Motors Company are two American automotive giants. Sales are approaching a hundred and ninety billion dollars. But which one of these two is a better investment at current market prices?

Sales trends look almost identical for Ford Motor and General Motor Company looking back over the previous decade. More recently, a hundred and eighty-eight billion dollars in trailing twelve-month revenue for Ford,

Thankfully, tariffs have kept Chinese cars out of the United States and that's allowed Ford and General Motors to keep strong market shares here in the states. You might be surprised to know that Ford and General Motors they haven't reported an operating profit margin in the double digits in the previous decade, not once, not one single year.

Ford peaked at about 4 and a quarter percent, maybe closer to 5% in 2017.

but I recently made upgrades. Ford and GM were two companies that I recently upgraded to buying opportunities as a result of some changing dynamics that work in their favor, most notably the removal of this push, this force from the United States government to electric vehicles that had been a significant negative for Ford and GM, but the US government removed that recently.

And so those have been positive for Ford and GM.

They benefit from selling heavy trucks, the Ford F-150, So, what about valuation here? Ford and GM are selling at high mid-single-digit valuations. Forward price to earnings of seven for Ford,

Again, it's because the car industry is not a lucrative industry, and so you rarely see car companies trading at premium valuations. Not unless you're able to convince investors that you're an AI and robotics company, can you earn a premium valuation as a car company, right?

You've got to have a really strong salesman as a CEO to be able to convince investors of that fact. Ford and GM haven't been able to do that, so their valuations have remained in the single digits.

If I had to pick one of these two, now remember I have them both ranked as buying opportunities right now, so you don't have to pick just one of them. If you're interested, you can get split your purchase in two and buy both of them.

because I like the company's truck lineup better than Ford's truck lineup.