While in general, US car sales dropped in 2017, carmaker stocks are still valuable assets to invest in 2018. U.S. auto industry’s historic 7 year growth streak has ended in December, but no car manufacturer experienced financial troubles, and in fact, most have expanded production and have problems with finding qualified workers to sustain production. This means car stocks are still viable as a good investment option for those who prefer traditional manufacturing companies over whimsical internet startups like Snapchat.
3. Ferrari – $RACE
I suggest buying $race. Here’s why:
- There isn’t more iconic car brand than Ferrari (maybe except cryptotraders favorite Lambos), and since number of millionaires worldwide and general demand for luxury products is high, Ferrari sells like hot cakes. You can read about boom on exotic cars on Bloomberg.
- Exotic cars are high-margin products, which mean that manufacturers earn a lot on single sales. This drives gross profit to $1.5 bln at the end of 2016 – best result in history of this car manufacturer.
- 2017 return of Ferrari stock was whopping 93,98%, and on top of that, company pays out dividends. Expect similar in next 12 months.
You can’t lose on $race, unless some global crisis occurs in 2018 (which is impossible, given current economy condition). I recommend buying this stock with x1 leverage (or even more – I’m going x2 short term) to gain money from general interest in luxury cars and overcompensating middle-aged man!
2. Ford – $F
$F was the best performing car maker stock available on eToro in 2017. Here’s why you need to buy it in 2018 too:
- It’s world’s oldest car maker, famous for their Ford T and improvements in production by introduction of assembly line. This grandpa is still going strong with a lot of different cars produced, from big roadster to eco hybrid city cars. Ford also owns luxury brand Lincoln, and just like in the case of Ferrari, there will be a lot of demand for expensive cars in 2018.
- While their 2017 return wasn’t really impressive, Ford pays really good dividend (4,74% last year), so it’s a good company for long-term, passive income investment.
- Its number of new cars sold at the end of 2017 was one of the best among car makers in US, 2% increase over 2016. This is still the most popular car brand in the United States and favored by the investors too, so we can expect that it can beat its last year result.
Buy it with reasonable (read x1) leverage and enjoy profits from this reputable US carmaker!
1. Fiat Chrysler Automobiles – $FCA.MI
Fiat Chrysler Automobiles is an Italian-American company and world’s 8th largest auto maker. It’s listed on NYSE and Italian stock market, and on eToro it’s available to buy on Borsa Italiana. Here’s why you should invest in this carmaker stock:
- It owns a lot of high-profile car brands like Alfa Romeo, Chrysler, Dodge, Fiat, Jeep, Maserati and more. This company has cars from every segment: luxury, economy, off-road. Wide array of brands guarantee sales and popularity among buyers.
- This gave Fiat an excellent return of 76% in 2017 – best result among all major carmakers. It might repeat this immense success in 2018, with new car models to be released this year.
The only thing that can disrupt this immense growth this year might be some hiccup in the vulnerable Italian stock market, but if that won’t occur (not much probability), expect stellar profits from Fiat!
Bonus tip: DON’T buy this stock
DON’T BUY TESLA STOCK. It’s not worth it. Tesla has huge problems with delivering orders and a lot of delays and it needs a lot of cash to sustain this badly managed production. Musk is burning cash reserves from investors very fast and would soon need another loan, which means troubles and sudden devaluation of stock price in 2018. And the other car companies are also getting into this whole electrical car market, and have much better know how and capabilities to actually produce a working vehicle. If Musk can’t even build a proper car, how can he claim that he would “soon” land on the Mars? Being internet celebrity doesn’t mean you actually know how to manage complicated manufacturing process.
Do you have your favorite (or maybe hated?) car maker stocks? Let us know in comments.