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James Li
James Li
Articles (836)  | Author's Website |

4 Auto Manufacturers Gurus Agree On

The most-broadly-held guru stocks in the auto manufacturing sector in light of Tesla’s big tumble this week

According to aggregated portfolio statistics, the four most-broadly-held guru stocks in the auto manufacturing sector are General Motors Co. (NYSE:GM), Fiat Chrysler Automobiles NV (NYSE:FCAU), Tesla Inc. (NASDAQ:TSLA) and Ford Motor Co. (NYSE:F).

Most gurus have not released their second-quarter portfolios as the deadline is 45 days after quarter-end.

General Motors

Nineteen gurus own shares of General Motors with a combined weight of 37.92%. Berkshire Hathaway Inc. (NYSE:BRK.A)(NYSE:BRK.B), Warren Buffett (Trades, Portfolio)’s conglomerate, owns 72,269,696 shares with an equity portfolio weight of 1.34%.

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The Detroit-based company manufactures automobiles through brands like Cadillac, Chevrolet and Buick. GuruFocus ranks GM’s profitability 7 out of 10: Operating margins have increased approximately 14% per year on average despite underperforming 75% of global competitors. Additionally, the company has a solid Piotroski F-score of 6 and returns on equity that are outperforming 86.07% of global auto companies.

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Fiat Chrysler

Eleven gurus own shares of Fiat Chrysler with a combined weight of 89.39%. Mohnish Pabrai (Trades, Portfolio) owns 13,105,047 shares, dedicating 73.48% of his public portfolio, which represents less than 30% of total discretionary assets, to the stake.

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GuruFocus ranks Fiat Chrysler’s profitability 4 out of 10 on the heels of profit margins underperforming over 66% of global competitors. Additionally, the company’s 3.22% return on assets underperforms 64.95% of global auto manufacturers.

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Tesla

Nine gurus own shares of Tesla with a combined weight of 3.54%. Ron Baron (Trades, Portfolio)’s 1,645,209 shares occupy 1.95% of the equity portfolio, while Spiros Segalas (Trades, Portfolio)’ 1,375,712 shares occupy 1.05% of the equity portfolio.

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Shares of Tesla continued to decline Friday morning, trading at an intraday low of $222.25, which is down approximately 2.87% from Thursday’s close of $228.82 and down approximately 16.09% from Wednesday’s close of $264.88. The stock tumbled on the heels of reporting a second-quarter loss that exceeded the consensus estimate by approximately 60 cents per share.

GuruFocus ranks Tesla’s financial strength 4 out of 10 on several weak signs, which include debt ratios that underperform over 83% of global competitors and an Altman Z-score that suggests possible financial distress. Other warning signs include increasing long-term debt over the past three years and declining gross margins over the past five years.

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Ford

Eight gurus own shares of Ford with a combined weight of 2.01%.

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The Detroit-based auto company manufactures automobiles through brands like Ford and Lincoln. GuruFocus ranks the company’s financial strength 5 out of 10: Although it has a solid Piotroski F-score of 5, Ford’s Altman Z-score and debt ratios signal possible financial distress.

Disclosure: No positions.

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About the author:

James Li
I am an editorial assistant and researcher at GuruFocus. I have a Master's in Finance from SMU, and I enjoy writing reports on financial trends and investor portfolios. Follow me on Twitter at @JamesLiGuru!

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