Fears of an Auto Sales Slowdown May Be Overblown

Concerns about whether the auto industry has seen its best sales days may be overblown, according to one analyst.

Automakers sold 17.55 million units in the U.S. in 2016, edging out 2015 by about 50,000 vehicles to become the best sales year on record. A combination of low gas prices, rising employment and low interest rates kept the showrooms busy in 2016.

If sales hold up, expect General Motors (GM) - Get Report and Ford (F) - Get Report to be among the primary beneficiaries.

The analyst notes that both carmakers are trading at valuations below their long-term average of 4.6 -- at 3.3 times 2017 estimated earnings before interest, taxes, depreciation and amortization and 3.0 times, respectively.

This article was written by a staff member of TheStreet.