General Motors and Ford Motor both beat earnings expectations for the first quarter in April, but only one hiked full-year guidance. Both GM stock and Ford stock have fashioned bases since their latest quarterly reports, but one looks far better than the other.
So which one is it?
GM Stock Performance
Shares of General Motors gained 0.8% in Wednesday's stock market action. That came after a rally above the 50-day moving average last Friday. The GM stock chart shows a flat base with a buy point at 46.16, with shares just 1% below the entry on Wednesday. The entry also marks a 52-week high, which came on strong earnings.
The relative strength line is starting to trend higher but remains below the consolidation peak for now. A rising RS line means that a stock is outperforming the S&P 500 index. It's the blue line in the chart provided.
Investors may wish to see that strength indicator catch up by the time GM stock breaks out. Overall, the base shows tighter and better form than GM's price action in the preceding year. That's when the auto stock made a deep decline in choppy trading.
On April 23, GM delivered a big first-quarter earnings beat and raised full-year guidance. Analysts now expect 2024 EPS of $9.26, a 21% increase from the prior year, FactSet shows.
The North American segment, fueled by truck sales, helped to drive the beat-and-raise report, the auto giant said.
Reflecting the industry at large, GM and Ford have seen sales of electric vehicles slow down. Now GM especially is playing catch-up in hybrid market, where sales have surged.
To assuage restless investors, the company has sharply increased share buybacks and dividends.
Ford Stock Performance
Shares of Ford edged up 0.3% on Wednesday, below the 50-day line. Ford stock is eyeing a 13.95 cup-with-handle entry, but there are issues.
The base is a bit deep (38%) and the handle is deeper than normal (18%). Moreover, the RS line remains in a long downtrend.
The Accumulation/Distribution Rating of D+ is another sign of weakness.
Not least, much of the base for Ford stock has formed below the 200-day line, which is a negative sign. By comparison, GM stock has been riding an air cushion above that long-term support level.
On April 24, Ford beat Q1 earnings estimates and backed its full-year earnings guidance. Analysts now project 2024 EPS of $1.94, a 4% decrease from the previous year.
Ford Motor on Tuesday reported an 11% year-over-year increase in U.S. new vehicle sales for the month of May. Sales of electric vehicles and hybrid vehicles both jumped roughly 65%. Sales of tradititional combustion-engine vehicles rose 5.6%, with sales of the top-selling F-series trucks down 1.6%. Overall Ford sales rose in May to 190,014 vehicles, with traditional vehicles making up 86% of the total.
Year to date, GM stock has jumped 27%. Ford stock is down 1.% from where it began this year.
