Despite facing challenges such as strikes and other impediments, the automotive landscape in the United States exhibited resilience in October, with new vehicle sales experiencing a 2% rise year-over-year to 1,211,131 units. So, I think investors could consider grabbing top auto stocks Bayerische Motoren Werke Aktiengesellschaft (BMWYY – Get Rating), Stellantis N.V. (STLA – Get Rating), and Honda Motor Co., Ltd. (HMC – Get Rating) this month.
In the midst of swift advancements in electric powertrains, advanced driver assistance systems, connected car technology, and alternative fuel solutions, the automotive industry is undergoing rapid transformation.
Value added in the Automotive Products market is projected to amount to $362.80 billion this year and grow at a CAGR of 2.20% until 2028. The market output is expected to be $1.11 trillion in 2023.
The U.S. motor vehicle production is expected to reach approximately 11.7 million units by 2025.
Furthermore, the automotive artificial intelligence market is thriving due to increased demand for self-driving cars and the integration of AI technologies into automotive systems. Advancements in machine learning algorithms and computer vision further drive AI adoption in the automotive industry.
The global automotive artificial intelligence (AI) market is expected to be worth $7 billion by 2027, with a CAGR of 24.1%.
However, leading auto company Tesla, Inc. (TSLA – Get Rating) faces increased competition in the evolving automotive market due to the rapid growth of traditional auto giants and the emergence of numerous smaller players, challenging TSLA’s dominance.
Shares of TSLA plummeted 5.5% over the past month, closing the last trading session at $237.41.
In addition, TSLA reported a 22.4% year-over-year decline in total gross profit to $4.18 billion in the fiscal third quarter ended September 29, 2023. Its adjusted EBITDA decreased 24.4% from the previous-year quarter to $3.76 billion.
Moreover, its trailing-12-month gross profit and levered FCF margins of 19.81% and 1.68% are lower than industry averages of 35.74% and 5.33%.
So, let us examine the fundamentals of…
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