Gurus Are Driving Away With These 5 Auto Stocks

Summary

• Toyota shares spiked after it revealed its EV plans.
• Auto manufacturers that were popular with gurus in the first quarter included Tesla, GM, Ford, Stellantis and Ferrari.

Shares of automaker Toyota Motor Corp. (TM, Financial) climbed more than 5% on Tuesday morning after its plans for next-generation battery electric vehicles were announced.

The Japanese company said a full lineup of vehicles will be developed and manufactured by its new BEV Factory unit, which it established in May. Targeting a driving range of 620 miles for its EVs, the factory aims to produce about 1.7 million vehicles by 2030.

Further, Toyota hopes to achieve overall sales of 1.5 million all-electric cars per year by 2026 and 3.5 million annually by 2030.

Having suffered during the pandemic due to chip shortages and factory shutdowns, the vehicles and parts industry as a whole has seen a strong performance so far this year with a 7.21% gain.

Due to these developments, investors may be interested in automakers that are popular among gurus currently.

According to GuruFocus’ Hot Picks, a Premium feature based on 13F filings, the auto manufacturers most-bought by gurus during the first quarter of 2023 included Tesla Inc. (TSLA, Financial), General Motors Co. (GM, Financial), Ford Motor Co. (F, Financial), Stellantis NV (STLA, Financial) and Ferrari NV (RACE, Financial).

Investors should be aware that 13F filings do not give a complete picture of a firm’s holdings as the reports only include its positions in U.S. stocks and American depository receipts, but they can still provide valuable information. Further, the reports only reflect trades and holdings as of the most-recent portfolio filing date, which may or may not be held by the reporting firm today or even when this article was published.

Tesla

Held by 15 gurus with a combined equity portfolio weight of 38.87%, 10 buys and nine sells were recorded for Tesla (TSLA, Financial) in the first quarter.

The Austin, Texas-based EV manufacturer has an $800.43 billion market cap; its shares were trading around $252.54 on Tuesday with a price-earnings ratio of 74.28, a price-book ratio of 16.66 and a price-sales ratio of 10.18.

The GF Value Line
VALU
suggests the stock is significantly undervalued currently based on its historical ratios, past financial performance and analysts’ future earnings projections.

At 85 out of 100, the GF Score indicates the company has good outperformance potential. While it received high ratings for growth, financial strength, value and momentum, the profitability rank was more moderate.

Of the gurus invested in Tesla, Baillie Gifford (Trades, Portfolio) has the largest stake with 0.82% of its outstanding shares. Ron Baron (Trades, Portfolio), PRIMECAP Management (Trades, Portfolio), Catherine Wood (Trades, Portfolio), Philippe Laffont (Trades, Portfolio), the Harbor Capital Appreciation Fund (Trades, Portfolio) and Jim Simons (Trades, Portfolio)’ Renaissance Technologies also have notable positions in the stock.

General Motors

Recording eight buys and 12 sells for the quarter, 20 gurus are invested in General Motors (GM, Financial). The combined weight in their equity portfolios is 11.72%.

The legacy automaker headquartered in Detroit, which has brands like Buick, Cadillac, Saab and Hummer under its umbrella, has a market cap of $51.69 billion; its shares were trading around $37.19 on Tuesday with a price-earnings ratio of 5.74, a price-book ratio of 0.75 and a price-sales ratio of 0.33.

According to the GF Value Line, the stock is modestly undervalued currently.

The GF Score of 79 implies the company is likely to have average performance going forward on the back of high ratings for profitability, value and momentum as well as more moderate growth and financial strength ranks.

With a 2.88% stake, Warren Buffett (Trades, Portfolio) is General Motors’ largest guru shareholder. Other top guru investors include Hotchkis & Wiley, Diamond Hill Capital (Trades, Portfolio), Bill Nygren (Trades, Portfolio), Simons’ firm, Jeremy Grantham (Trades, Portfolio) and Steven Cohen (Trades, Portfolio).

Ford

With the number of buys and sells both equaling seven for the quarter, 12 gurus have positions in Ford (F, Financial). They have a combined portfolio weight of 1.16% in the stock.

The Dearborn, Michigan-based auto company, which is known for its F-150 pickup trucks, Mustang sports cars and Bronco SUVs, has a $56.21 billion market cap; its shares were trading around $14.05 on Tuesday with a price-earnings ratio of 19.79, a price-book ratio of 1.38 and a price-sales ratio of 0.34.

Based on the GF Value Line, the stock appears to be fairly valued currently.

The GF Score of 72 means the company is likely to have average performance in the future, driven by a high momentum rank, middling marks for profitability, financial strength and value and a low growth rating.

Ken Fisher (Trades, Portfolio) has the largest stake in Ford with 1.28% of its outstanding shares. Simons’ firm and Grantham also have large positions.

Stellantis

Stellantis (STLA, Financial), which recorded five buys and six sells for the quarter, is held by 10 gurus with a combined equity portfolio weight of 4.55%.

The auto manufacturer headquartered in Amsterdam, which has brands like Maserati, Jeep, Dodge, Ram and Fiat in its portfolio, has a market cap of $52.57 billion; its shares were trading around $16.81 on Tuesday with a price-earnings ratio of 3.01, a price-book ratio of 0.69 and a price-sales ratio of 0.29.

The GF Value Line suggests the stock is fairly valued currently.

Supported by high ratings for three of the criteria and more moderate growth and value ranks, the company has good outperformance potential with a GF Score of 83.

Holding 0.12% of its outstanding shares, Simons’ firm is Stellantis’ largest guru shareholder. Grantham also has a sizeable position.

Ferrari

Held by six gurus with a combined equity portfolio weight of 2.10%, Ferrari (RACE, Financial) saw four buys and three sells in the first quarter.

The Italian manufacturer of luxury sports cars has a $54.64 billion market cap; its shares were trading around $300.72 on Tuesday with a price-earnings ratio of 53.04, a price-book ratio of 18.18 and a price-sales ratio of 9.56.

According to the GF Value Line, the stock is fairly valued currently.

The GF Score of 92 indicates the company has high outperformance potential. Despite receiving high profitability, growth and financial strength ranks, Ferrari has a more moderate momentum rank and a low value grade.

Baillie Gifford (Trades, Portfolio) is Ferrari’s largest guru shareholder with a 4.05% stake. Simons’ firm, Frank Sands (Trades, Portfolio), Lee Ainslie (Trades, Portfolio), Tiger Management (Trades, Portfolio) and Mario Gabelli (Trades, Portfolio) also own shares.

Additional picks

Other popular companies that were bought by gurus during the quarter included Rivian Automotive Inc. (RIVN, Financial), Fisker Inc. (FSR, Financial), Blue Bird
BLBD
Corp. (BLBD, Financial), Proterra Inc. (PTRA, Financial) and Honda Motor Co. Ltd. (HMC, Financial).

Disclosures

I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.