This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Auto Shares Like Auto Shows

Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

DETROIT ( TheStreet) -- The Detroit Auto Show shines a spotlight on the auto industry, and on auto stocks.

The show opens Jan. 15, but the press preview, expected to attract about 5,000 journalists (including TheStreet) from around the world, will take place Monday and Tuesday. Additionally, an investor conference, attended by many industry analysts, is scheduled for Tuesday.

"The auto show has historically been an important touch point for how the companies are feeling about demand for the year, about how they see their fundamentals shaping up for the year," said ConvergEx Group strategist Nicholas Colas. "It focuses the market's attention dramatically, because every analyst and every investor sees every company for a week -- it's the whole industry in five calendar days."

Obviously, the auto industry at the moment is brimming with optimism. Every known forecaster expects 2011 sales to rise from their 2010 level, both in the U.S. and worldwide. Sales trends have been strong for months, as the U.S. auto industry completed one of the most dramatic years in its history. Light vehicle sales in 2010 totaled 11.6 million.

"In many respects, 2010 was one of Ford's (F - Get Report) best years ever," said analyst George Pipas, on the automaker's December sales call last week. "The year ahead holds such great promise," he added.

Colas said auto shares often get a boost from the auto show, but the impact could be muted this year because shares have risen dramatically after a half dozen analysts initiated coverage of GM (GM - Get Report) on Dec. 28. Investment companies that participated in the offering had to wait until 40 days after the Nov. 18 IPO to initiate coverage. Nearly every analyst had a buy rating.

The positive feelings generally continued as the companies reported December and full-year sales the following week. The December sales rate was the highest since the "cash for clunkers" surge in August 2009. Fourth quarter sales were the highest since the third quarter of 2008, according to Ward's AutoInfoBank.

Since Dec. 28, Ford shares have risen 7%, closing Friday at $18.27. GM shares have risen 10 % to $38.98. Toyota (TM - Get Report) has risen 5% to $82.52, and Honda (HMC - Get Report) has lost 1%, closing Friday at $39.16. On Monday, Ford was up 4 cents to $18.31; GM was down 8 cents to $38.90; Toyota was down 16 cents to $82.30; and Honda was down 4 cents to $39.07.

-- Written by Ted Reed in Charlotte, N.C.

Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

>to contact the writer of this article, click here: Ted Reed

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
F $14.55 0.00%
GM $36.22 0.39%
HMC $32.89 0.74%
TM $124.02 0.73%
AAPL $118.88 0.96%


Chart of I:DJI
DOW 17,812.19 +19.51 0.11%
S&P 500 2,089.14 +2.55 0.12%
NASDAQ 5,102.8080 +0.33 0.01%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs