Car stocks traded mixed the day before the companies release January sales data. The number are expected to be as strong, if not stronger than those at the end of last year. US sales rose at a higher rate than either those in China, the world’s largest market, or Europe which is faltering.
Toyota (NYSE: TM) and Honda (NYSE: HMC) are expected to benefit from the fact that their production facilities will be at full capacity for the first time since the March Japan earthquake. Any pent-up demand for their products can be satisfied in the next several months. The yen has damaged their earnings, however, Honda reported weaker than expect results today. Operating income fell 65% in the last quarter. Honda’s shares fell nearly 2.4% to $34.14
Toyota’s shares have rallied and are up 10% this year, probably in anticipation of strong US sales.
Despite a weak fourth quarter, Ford’s shares (NYSE: F) are higher by 15% so far this year, and GM’s (NYSE: GM) are up 20%. If the stock market trades shares based on anticipated value six months out, car sales are expected to be unsually good
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