Investors looking for exposure to auto stocks but don't want to deal with Tesla Inc (NASDAQ: TSLA) should consider General Motors Company (NYSE: GM) over Ford Motor Company (NYSE: F), according to two pros.
GM Showing 'Some Promise'
If GM is showing little "promise," Ford is showing "less to no promise," Blue Line Capital founder and president Bill Baruch said Friday afternoon on CNBC. GM's stock chart is showing "some promise," having formed a supportive trend line since bottoming near $18 per share in the early 2010s with a support level of around $33.
Ford, on the other hand, has been trending lower consistently since 2014 and showing no signs of any rebound. The stock has a path to drop to "at least $7" per share and Baruch would "stay away" from the stock.
Ford Story 'Really Negative'
GM and Ford both have negative stories to tell but at least in GM's case, all of the negativity is priced into the stock, Chantico Global founder and CEO Gina Sanchez said on CNBC.
"So, if I were to have to choose between Ford and GM, I'd go with GM," she said. "They are better priced."
Commenting on Tesla's stock, Sanchez said investors are paying a "huge price" today for a company that needs a very long time to grow into its valuation. In fact, investors assuming Tesla needs a few years of 500,000-unit deliveries are mistaken, Sanchez said. The company needs to deliver half a million cars per year for decades to "make good on its overheated" $135 billion valuation.
General Motors CEO Mary Barra in June 2017. Photo by Dustin Blitchok.