Barclays on U.S. Autos & Auto Parts: Still Like GM/F Pair Trade; OEM/Supplier Tips
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Price: $86.77 +0.44%
Rating Summary:
28 Buy, 13 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
28 Buy, 13 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Barclays on U.S. Autos & Auto Parts
Analyst, Brian Johnson suggests keeping the pair trade between GM (NYSE: GM) and Ford (NYSE: F) going (Buy GM / Sell F). He thinks that near-term catalysts are limited for Ford (citing European troubles and Neutral management). Whereas GM, expectations are still low and catalysts are high (restructuring Opel; US Treasury stake unwind and post-election boost).
Overall, Johnson believes U.S. sales remain solid (ex-SAAR tailwind), however European weakness is likely to continue in the second half, but doesn't see the situation in mass-market worsening. Also, OEMs and suppliers have announced their production cuts and Johnson believes investors have now priced in bottoms.
Other trades Johnson likes include: 1) BorgWarner (NYSE: BWA) and Delphi (Nasdaq: DLPH) could benefit from persistence of the Europe risk-on trade; 2) Although shorter-term global CV datapoints show headwinds for Dana Corp (NYSE: DAN) and Tenneco (NYSE: TEN), we continue to see solid mid-term upside for the two stocks; 3) Johnson Controls (NYSE: JCI) drawing increased strength, and could see a further rebound on better HVAC margins; 4) American Axle (NYSE: AXL) may have further room to run in advance of K2XX release.
Analyst, Brian Johnson suggests keeping the pair trade between GM (NYSE: GM) and Ford (NYSE: F) going (Buy GM / Sell F). He thinks that near-term catalysts are limited for Ford (citing European troubles and Neutral management). Whereas GM, expectations are still low and catalysts are high (restructuring Opel; US Treasury stake unwind and post-election boost).
Overall, Johnson believes U.S. sales remain solid (ex-SAAR tailwind), however European weakness is likely to continue in the second half, but doesn't see the situation in mass-market worsening. Also, OEMs and suppliers have announced their production cuts and Johnson believes investors have now priced in bottoms.
Other trades Johnson likes include: 1) BorgWarner (NYSE: BWA) and Delphi (Nasdaq: DLPH) could benefit from persistence of the Europe risk-on trade; 2) Although shorter-term global CV datapoints show headwinds for Dana Corp (NYSE: DAN) and Tenneco (NYSE: TEN), we continue to see solid mid-term upside for the two stocks; 3) Johnson Controls (NYSE: JCI) drawing increased strength, and could see a further rebound on better HVAC margins; 4) American Axle (NYSE: AXL) may have further room to run in advance of K2XX release.
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