Ford Motor is one of the least favored stocks on Wall Street, but it has recently risen for 10 consecutive trading days, or more than 22%.

(Reuters)

[Financial Channel/Comprehensive Report] Ford Motor (Ford Motor) is one of the least optimistic stocks on Wall Street, but Ford closed up 1.67% on Thursday (12th), rising for 10 consecutive trading days, with a cumulative increase of more than 22%. The outside world is quite surprised.

Analysts believe that Ford's rally may be just because its performance in 2022 is too bad, and investors often deal with tax issues at the end of the year, so they will sell those loss-making stocks for tax deductions.

US media "Barron's" (Barron's) reported that Ford Motor closed at $13.43 on Thursday, an increase of about 14% this year. Considering that Wall Street is bearish on the auto industry, this wave of gains has surprised the outside world; Ford is also the least favored by Wall Street. One of the most bullish stocks, only 38% of analysts have Buy ratings, compared with an average of 58% for the S&P 500.

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Analysts have reservations about how automakers will fare in 2023—whether they can resume production while maintaining profit margins?

Coupled with an annual decline of about 8% in U.S. car sales in 2022, new car sales will hit the lowest level since 2011.

Goldman Sachs analyst Mark Delaney pointed out that the weak macroeconomic background will make the auto industry in a challenging and volatile fundamental environment in 2023.

The report believes that the most basic reason for this wave of gains in Ford's stock price may be that its performance in 2022 is too bad, with a drop of more than 40%. In addition, investors always sort out tax issues at the end of the year, because selling loss-making stocks can be deducted from capital gains. , can be redeemed after 31 days.

After selling, if investors are still interested in Ford, they can buy it back at the new cost price.

It's not uncommon for year-end losers to surge in January, with auto stocks in the Russell 3000's auto and auto parts index down an average of 40% in the past year, though they're up about 10% on average since January.

The report believes that the rebound in January is not due to the optimistic outlook of the auto industry. Auto stocks including Ford and Tesla may rise this year, but this should depend on fundamental factors rather than taxation in January. generated transactions.

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