American Axle (AXL - Get Report) is highly exposed to pickup trucks, SUVs and smaller haulers, known as CUVs. Trucks and SUVs saw demand plunge to an even greater extent than cars, in large part to a sharp slump in the construction industry.
Demand for these vehicles is now rebounding at a solid clip, especially since many of these larger vehicles have seen major fuel efficiency gains. But demand will rise even higher when the construction industry gets back on its feet.A major truck redesign from GM, known as the CMT900, should give a tangible boost to American Axle's results. Trading at four times projected 2013 profits, shares could move up 40% from current levels and still trade for less than six times projected profits. Worried about exposure to Europe? American Axle derives less than 10% sales form the Continent, among the smallest geographical exposure in the industry. American Axle shows up on a recent list of Stocks in Bottoming Sectors Primed for a 2012 Bounce. Follow @stockpickr