The US auto industry is facing a challenging 2024, marked by declining new vehicle sales and affordability concerns. However, Wall Street remains bullish on three auto stocks for 2025: Blue Bird Corporation, Dorman Products, and Westport Fuel Systems. These companies have received Zacks Rank #1 or 2, with over 70% of brokers recommending them.
Blue Bird Corporation is poised to benefit from the growing demand for electric school buses. The company has expanded into alternative fuels and EV technologies, offering a range of products including battery-electric, gasoline, and propane buses. With a backlog of 4,800 units, including nearly 630 electric buses, Blue Bird continues to capitalize on robust market demand.
Dorman Products is well-positioned in the motor vehicle aftermarket industry, focusing on replacement and upgrade parts for vehicles of all ages. The company’s strong balance sheet and debt-to-capitalization ratio of 28% make it an attractive investment opportunity. Dorman has surpassed earnings estimates in each of the trailing four quarters, with a Zacks Consensus Estimate for 2025 sales and earnings implying year-over-year growth of 4% and 9%, respectively.
Westport Fuel Systems is benefiting from global climate change mandates and its proprietary HPDI fuel system. The company’s low debt level and commitment to advancing the commercialization and adoption of its HPDI technology position it for significant growth in 2025. Westport’s Zacks Consensus Estimate for 2025 bottom line implies a year-over-year improvement of 10%, with a Wall Street average price target suggesting nearly 220% upside for the stock from current levels.
Overall, these three auto stocks offer an attractive investment opportunity amidst the challenges facing the US auto industry in 2024. With their strong fundamentals and bullish outlook, investors may consider adding them to their portfolios in 2025.
Source: https://finance.yahoo.com/news/wall-streets-3-favorite-auto-152100145.html