As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the automobile manufacturing industry, including Lucid (NASDAQ: LCID) and its peers.
Much capital investment and technical know-how are needed to manufacture functional, safe, and aesthetically pleasing automobiles for the mass market. Barriers to entry are therefore high, and auto manufacturers with economies of scale can boast strong economic moats. However, this doesn’t insulate them from new entrants, as electric vehicles (EVs) have entered the market and are upending it. This has forced established manufacturers to not only contend with emerging EV-first competitors but also decide how much they want to invest in these disruptive technologies, which will likely cannibalize their legacy offerings.
The 7 automobile manufacturing stocks we track reported a slower Q3. As a group, revenues missed analysts’ consensus estimates by 3.4%.
Thankfully, share prices of the companies have been resilient as they are up 6.3% on average since the latest earnings results.
Lucid (NASDAQ: LCID)
Founded by a former Tesla Vice President, Lucid Group (NASDAQ: LCID) designs, manufactures, and sells luxury electric vehicles with long-range capabilities.
Lucid reported revenues of $200 million, up 45.2% year on year. This print exceeded analysts’ expectations by 1%. Despite the top-line beat, it was still a mixed quarter for the company with an impressive beat of analysts’ sales volume estimates but a significant miss of analysts’ adjusted operating income estimates.
"Our momentum continues with our third consecutive quarter of record deliveries," said Peter Rawlinson, CEO and CTO at Lucid.
Unsurprisingly, the stock is down 1.4% since reporting and currently trades at $2.19.
Is now the time to buy Lucid? Access our full analysis of the earnings results here, it’s free.
Best Q3: General Motors (NYSE: GM)
Founded in 1908 by William C. Durant, General Motors (NYSE: GM) offers a range of vehicles and automobiles through brands such as Chevrolet, Buick, GMC, and Cadillac.
General Motors reported revenues of $48.76 billion, up 10.5% year on year, outperforming analysts’ expectations by 9.9%. The business had a very strong quarter with an impressive beat of analysts’ adjusted operating income estimates and full-year EPS guidance exceeding analysts’ expectations.
General Motors scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 13.9% since reporting. It currently trades at $55.75.
Is now the time to buy General Motors? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: Winnebago (NYSE: WGO)
Created to provide high-quality, affordable RVs to the post-war American family, Winnebago (NYSE: WGO) is a manufacturer of recreational vehicles, providing a range of motorhomes, travel trailers, and fifth-wheel products for outdoor and adventure lifestyles.
Winnebago reported revenues of $720.9 million, down 6.5% year on year, falling short of analysts’ expectations by 1%. It was a disappointing quarter as it posted full-year revenue guidance missing analysts’ expectations.
The stock is flat since the results and currently trades at $58.59.
Read our full analysis of Winnebago’s results here.
Tesla (NASDAQ: TSLA)
Originally founded by Martin Eberhard and Marc Tarpenning in 2003, Tesla (NASDAQ: TSLA) is an electric vehicle company accelerating the world’s transition to sustainable energy.
Tesla reported revenues of $25.18 billion, up 7.8% year on year. This print lagged analysts' expectations by 1%. Tesla beat analysts’ gross margin expectations this quarter (19.8% vs 16.9%). That helped it beat on adjusted earnings per share, Adjusted EBITDA, and Free Cash Flow. Additionally, Tesla saw vehicle delivery growth of 6.4% quarter on quarter, the first time this year the company has seen quarter on quarter delivery growth.
The stock is up 64% since reporting and currently trades at $350.35.
Read our full, actionable report on Tesla here, it’s free.
Ford (NYSE: F)
Established to make automobiles accessible to a broader segment of the population, Ford (NYSE: F) designs, manufactures, and sells a variety of automobiles, trucks, and electric vehicles.
Ford reported revenues of $46.2 billion, up 5.5% year on year. This result surpassed analysts’ expectations by 9.1%. Aside from that, it was a mixed quarter as it also logged a decent beat of analysts’ EPS estimates but a miss of analysts’ adjusted operating income estimates.
The stock is down 2.2% since reporting and currently trades at $11.12.
Read our full, actionable report on Ford here, it’s free.
Market Update
In response to the Fed's rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed's 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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