General Motors (NYSE:GM) and Ford Motor (NYSE:F) are both large-cap auto/tires/trucks companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, dividends, analyst recommendations, institutional ownership, earnings, risk and profitability.
Risk & Volatility
General Motors has a beta of 1.42, indicating that its stock price is 42% more volatile than the S&P 500. Comparatively, Ford Motor has a beta of 1.27, indicating that its stock price is 27% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current ratings and recommmendations for General Motors and Ford Motor, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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General Motors | 2 | 1 | 15 | 0 | 2.72 |
Ford Motor | 2 | 7 | 5 | 0 | 2.21 |
General Motors currently has a consensus target price of $55.3889, indicating a potential upside of 5.42%. Ford Motor has a consensus target price of $9.9643, indicating a potential downside of 16.83%. Given General Motors' stronger consensus rating and higher probable upside, equities analysts clearly believe General Motors is more favorable than Ford Motor.
Profitability
This table compares General Motors and Ford Motor's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
General Motors | 2.92% | 9.78% | 1.87% |
Ford Motor | -0.12% | 2.48% | 0.30% |
Valuation and Earnings
This table compares General Motors and Ford Motor's top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
General Motors | $137.24 billion | 0.55 | $6.73 billion | $4.82 | 10.90 |
Ford Motor | $155.90 billion | 0.31 | $47 million | $1.19 | 10.07 |
General Motors has higher earnings, but lower revenue than Ford Motor. Ford Motor is trading at a lower price-to-earnings ratio than General Motors, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
77.7% of General Motors shares are owned by institutional investors. Comparatively, 48.8% of Ford Motor shares are owned by institutional investors. 0.7% of General Motors shares are owned by company insiders. Comparatively, 0.9% of Ford Motor shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Summary
General Motors beats Ford Motor on 12 of the 14 factors compared between the two stocks.