Jim Cramer said Monday to buy GM because of the lack of clarity regarding the future of Ford celebrity CEO Alan Mulally. UBS analyst Colin Langan recently picked Ford over GM because, he said, GM is now benefiting from introduction of its 2014 Silverado.
GM shares lately have benefited from the perception gap. Shares are up 34% this year and down 0.36% over the past five days. Shares closed Wednesday at $16.62, up 57 cents. Ford shares are up 28% for the year and down 2.41% over the past five days. Shares closed Wednesday at $16.62, up 6 cents.
On Tuesday, GM said its November sales rose 13.7%, while Ford November sales rose 7%. Ford said it will cut production from 784,000 to 770,000 through March to better match inventory to demand. Ford shares fell 3% on Tuesday, while GM shares fell 2%.
Nevertheless, in notes issued after sales figures were released on Tuesday, Levy rated Ford a buy and GM a hold. For Ford, he raised his full-year earnings estimates to $1.67 a share in 2013 and $1.92 in 2014, "including the impact of Ford's expectations for lower Q1 vehicle production." He left his target price at $19, 10 times his EPS estimate.
For GM, Levy left his target price at $39. He wrote that is "concerned about rising vehicle inventories." GM said its inventory increased to 96 days, while Ford's grew to 89 days.