Shares of Ford Motor Corp surged on Wednesday after Goldman Sachs Group Inc. gave its thumbs up to the company, noting the automaker has a “superior growth outlook.”
Goldman said in a research note the redesigned F-150 pickups, set to launch later this year, will help push that phenomenal growth for Ford. It expects the new pick-up trucks will boost earnings, potentially way through 2016.
Aside from the new products competitively priced, Goldman said it helps that Ford isn’t dependent on China for its income, which is the opposite for GM.
These observations prompted Goldman to eventually upgrade Ford to “buy” from “neutral” as well as raise the automaker’s shares to $19 from $18 on a 12-month price target.
“The key driver is a superior growth outlook at Ford as it starts to see the volume, mix, and pricing benefits from the F-150 launch in [the second half of 2015], as well as still improving positioning in China,” analyst Patrick Archambault wrote in a note to clients. “On the flip side, GM truck incentives are already rising from increased competition, and we believe its China guidance looks vulnerable.”
Archambault downgraded GM from “buy” to “neutral.” He also cut his price target for GM’s stock from $46 to $40.