Industrials Stocks: Automakers Look Undervalued
We are concerned about a slow start to U.S. light-vehicle sales this year, but we expect improvement once the cold abates.
Quarter-End Insights
Mentioned: Alstom SA (ALO)
, General Motors Co (GM)
, Taylor Morrison Home Corp (TMHC)
, CNH Industrial NV (CNHI)
, AGCO Corp (AGCO)
, Toll Brothers Inc (TOL)
, PulteGroup Inc (PHM)
, CSX Corp (CSX)
, General Electric Co (GE)
, Kansas City Southern (KSU)
- The U.S. has released mixed macroeconomic data since our last outlook. The reduction of fourth-quarter GDP was expected, and we still look for GDP growth similar to 2013. On the positive side, January housing sales increased more than consensus and February PMI also beat expectations.
- Autos remain the source of most undervalued names in industrials. We are concerned about a slow start to U.S. light-vehicle sales this year, but we expect improvement once the cold abates.
- In addition to the auto sector, we highlight value in diversified manufacturers and agricultural equipment.
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David Whiston does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.