Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Gold & the USDX: Correlations - 2nd Dec 20
How An Ancient Medicine Is Taking On The $16 Trillion Pharmaceutical Industry - 2nd Dec 20
Amazon Black Friday vs Prime Day vs Cyber Monday, Which are Real or Fake Sales - 1st Dec 20
The No.1 Biotech Stock for 2021 - 1st Dec 20
Stocks Bears Last Chance Before Market Rally To SPX 4200 In 2021 - 1st Dec 20
Globalists Poised for a “Great Reset” – Any Role for Gold? - 1st Dec 20
How to Get FREE REAL Christmas Tree 2020! Easy DIY Money Saving - 1st Dec 20
The Truth About “6G” - 30th Nov 20
Ancient Aztec Secret Could Lead To A $6.9 Billion Biotech Breakthrough - 30th Nov 20
AMD Ryzen Zen 3 NO UK MSRP Stock - 5600x, 5800x, 5900x 5950x Selling at DOUBLE FAKE MSRP Prices - 29th Nov 20
Stock Market Short-term Decision Time - 29th Nov 20
Look at These 2 Big Warning Signs for the U.S. Economy - 29th Nov 20
Dow Stock Market Short-term and Long-term Trend Analysis - 28th Nov 20
How To Spot The End Of An Excess Market Trend Phase – Part II - 28th Nov 20
The Gold Stocks Correction is Maturing - 28th Nov 20
Biden and Yellen Pushed Gold Price Down to $1,800 - 28th Nov 20
Sheffield Christmas Lights 2020 - Peace Gardens vs 2019 and 2018 - 28th Nov 20
MUST WATCH Before You Waste Money on Buying A New PC Computer System - 27th Nov 20
Gold: Insurance for Prudent Investors, Precious Metals Reduce Risk & Preserve Wealth - 27th Nov 20
How To Spot The End Of An Excess Market Trend Phase - 27th Nov 20
Snow Falling Effect Christmas Lights Outdoor Projector Amazon Review - 27th Nov 20
4 Reasons Why You Shouldn't Put off Your Roof Repairs - 27th Nov 20
Further Clues Reveal Gold’s Weakness - 26th Nov 20
Fun Things to Do this Christmas - 26th Nov 20
Industries that Require Secure Messaging Apps - 26th Nov 20
Dow Stock Market Trend Analysis - 25th Nov 20
Amazon Black Friday Dell 32 Inch S3220DGF VA Curved Screen Gaming Monitor Bargain Deal! - 25th Nov 20
Biden the Silver Bull - 25th Nov 20
Inflation Warning to the Fed: Be Careful What You Wish For - 25th Nov 20
Financial Stocks Sector ETF Shows Unique Island Setup – What Next? - 25th Nov 20
Herd Immunity or Herd Insolvency: Which Will Affect Gold More? - 25th Nov 20
Stock Market SEASONAL TREND and ELECTION CYCLE - 24th Nov 20
Amazon Black Friday - Karcher K7 FC Pressure Washer Assembly and 1st Use - Is it Any Good? - 24th Nov 20
I Dislike Shallow People And Shallow Market Pullbacks - 24th Nov 20
Small Traders vs. Large Traders vs. Commercials: Who Is Right Most Often? - 24th Nov 20
10 Reasons You Should Trade With a Regulated Broker In UK - 24th Nov 20
Stock Market Elliott Wave Analysis - 23rd Nov 20
Evolution of the Fed - 23rd Nov 20
Gold and Silver Now and Then - A Comparison - 23rd Nov 20
Nasdaq NQ Has Stalled Above a 1.382 Fibonacci Expansion Range Three Times - 23rd Nov 20
Learn How To Trade Forex Successfully - 23rd Nov 20
Market 2020 vs 2016 and 2012 - 22nd Nov 20
Gold & Silver - Adapting Dynamic Learning Shows Possible Upside Price Rally - 22nd Nov 20
Stock Market Short-term Correction - 22nd Nov 20
Stock Market SPY/SPX Island Setups Warn Of A Potential Reversal In This Uptrend - 21st Nov 20
Why Budgies Make Great Pets for Kids - 21st Nov 20
How To Find The Best Dry Dog Food For Your Furry Best Friend?  - 21st Nov 20
The Key to a Successful LGBT Relationship is Matching by Preferences - 21st Nov 20
Stock Market Dow Long-term Trend Analysis - 20th Nov 20
Margin: How Stock Market Investors Are "Reaching for the Stars" - 20th Nov 20
World’s Largest Free-Trade Pact Inspiration for Global Economic Recovery - 20th Nov 20
Dating Sites Break all the Stereotypes About Distance - 20th Nov 20

Market Oracle FREE Newsletter

FIRST ACCESS to Nadeem Walayat’s Analysis and Trend Forecasts

2015 Could Be Ford's Best Year Ever

Currencies / US Auto's Dec 26, 2014 - 03:55 PM GMT

By: Money_Morning


William Patalon writes: I've always been a "car guy."

Back in my high-school, college, and twentysomething years, the term was "motorhead."

I liked to soup up cars, did a bit of drag racing, and restored several antiques and classics with my Dad.

So I know cars.

And as I told Private Briefing readers in a column a few weeks back, I also know Ford.

I've been following the brand, and Ford Motor Co. (NYSE: F) itself, since my teen years. And I really stepped up my focus on the company – as an investment – when I became a journalist in the mid-1980s.

Late last month, I predicted that Ford would be one of the best stocks for 2015.

And a report that I came across yesterday bolstered my belief in my forecast.

Let's take a look…

It's Like the Financial Crisis Never Happened

U.S. sales of new cars and trucks will rise 2.6% to reach 17 million units in the New Year – the best showing since 2005, according to a new forecast by TrueCar, the Web-based auto-sales service. And that follows a year (2014) in which combined U.S. sales of new and used vehicles will rise 8.3% to reach $1.1 trillion – creating a momentum so strong that it will carry into the New Year.

"The overall buying power in the auto market sometimes isn't fully appreciated," TrueCar President John Krafcik said. "To put this in perspective, new vehicle revenue alone will surpass the value of new single family homes in the U.S. nearly three times [in 2014]. It's a remarkable year for the industry as both sides of the market are seeing notable growth and commanding strong pricing power."

Pricing power – a term that investors love to hear.

What it means is that there's so much demand for a product that the company making it can raise prices without scaring folks away. Pricing power provides an "operating leverage" that, in simple terms, means a company like Ford can make more money than it did previously on every vehicle it sells.

Ford has traditionally had some nice pricing power with its hot-selling F-150 pickup truck. But TrueCar forecasters are saying that car companies are going to enjoy even broader pricing power than in years past.

Combine that pricing power with forecasts for higher sales – some industry experts are predicting new car sales could match or exceed previous peaks in the 17 million range – and you're talking about a bullish year for the auto sector.

The "catalysts" are there in the form of a cheap gasoline prices and a surging U.S. economy.

U.S. Growth Will Be Better Than Expected

We all know what's been happening with energy prices. We've talked about the big slide in crude (and the money to be made there) in several recent Private Briefing reports.

And we've also talked to you about the strong economy.

But that's worth drilling into a bit more…

A brand-new forecast by Kiplinger's magazine calls for global growth to average 3.2% in the New Year – not bad, given the headwinds some regions are facing.

The U.S. economy is expected to grow at a 3% pace or better in 2015. Like the auto-sales numbers, that's the best annual growth rate since 2005 – up from an expected 2.2% this year.

Wages are rising, giving U.S. families more buying power. And falling food and energy prices – coupled with the lowest household debt-to-income ratio since 2002 – gives households more to spend.

Businesses will do their part, increasing spending on plants and equipment by an average of about 7%, up from 5% in 2014.

"We're in a boomlet here in the U.S.," Bob Baur, chief global economist for Principal Global Investors, told Kiplinger's.

And many consumers have been delaying a car purchase. According to Michael A. Robinson, our resident tech expert and editor of Radical Technology Profits, the average car on the road today is 11.4 years old.

"By tech standards that's ancient history – and technology is a relevant point of discussion with autos these days," Michael told me. "With cars more than a year or two old, we're talking no backup cameras, no in-dash infotainment systems, no collision-avoidance sensors, self-parking features, Bluetooth, or integrated GPS. That becomes an additional incentive to buy a new car or truck."

Analysts right now have a $22 high-water estimate on Ford. I'm using that "high" estimate because I believe some dour comments have been holding down that company's share price of late. A $22 target price computes to a 43% gain from recent levels. And with the recent 3.3% dividend, you'll be well-paid to wait.

Up Next
CEO Buys His Own Stock – Bill Says Shares Are Going Up 108%…

One year ago, on December 2, 2013, the CEO of a tiny defense contractor bought over 30,000 shares of his own company. The stock went up 30% in just over a month. Recently, this CEO snapped up even more shares. This time Bill expects the stock to pop by 108%. For full access to Bill's report on this incredible opportunity, click here

Source :

Money Morning/The Money Map Report

©2014 Monument Street Publishing. All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Monument Street Publishing. 105 West Monument Street, Baltimore MD 21201, Email:

Disclaimer: Nothing published by Money Morning should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investent advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication, or after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Money Morning should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Money Morning Archive

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules