2 Automobile Manufacturers That Received Upgrades Last Week

Stock Markets38 minutes ago (Jun 09, 2021 02:30PM ET)

(C) Reuters. 2 Automobile Manufacturers That Received Upgrades Last Week

The automotive industry is expected to see a solid recovery later this year as disruptions caused by a global semiconductor chip shortage abate with huge government and private investments to boost semiconductor production. So, we think it could be wise to now bet on automobile manufacturers NIO (NIO) and Ford Motor (F) because they recently received upgrades from analysts and are favorably positioned to gain from the industry tailwinds. Read on to learn more.The COVID-19 pandemic-led restrictions wreaked havoc on the automotive industry last year as demand fell off a cliff. Global semiconductor supply constraints have also been negatively impacting the industry. However, according to Goldman Sachs’ (GS) chief Asia economist, the chip shortage should decline later this year as chip shipments improve and plants return to full working capacity. Huge government and private investments to boost semiconductor production should address the supply concern significantly in the coming months. This, along with the fast-paced economic reopening, should drive the automotive industry’s recovery.

Investors’ increasing interest in the automotive space is evident in the First Trust NASDAQ Global Auto Index Fund’s (CARZ) 10.1% returns over the past month versus the tech-heavy Nasdaq’s 1.6% gains. Also, traditional automakers might be in a more beneficial position than pure electric vehicle (EV) producers based on their broad portfolio of vehicles and market dominance.

Given the automotive industry’s promising recovery prospects, analysts are optimistic about the performance of NIO Inc. (NIO) and Ford Motor Company (NYSE:F). Analysts’ views on these stocks have recently been upgraded. So, we think it could be wise to scoop up these stocks now.

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2 Automobile Manufacturers That Received Upgrades Last Week

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