On today’s segment of Good Buy or Goodbye, host Julie Hyman is joined by Barron’s associate editor Al Root to discuss the best and worst stock picks within the auto sector.
Root recommends buying Ford (F), citing notable relative share performance and successful business re-segmentation. He highlights the Pro business’s "consistency of profits… with service and sales" and points to a recovering auto market, stating, "Things should continue to get better." However, he cautions investors about two primary risks for Ford: continued EV losses and business execution challenges.
On the other hand, Root advises investors to avoid Tesla’s (TSLA) stock. He expresses concern over the company’s high valuation, stating, "I don’t see how… this stock has a tremendous second half of 2024." Root also worries about Musk overpromising on projects like robotaxi and lower-priced EVs, warning that unfulfilled promises could lead to "a big disappointment for the market." Despite these concerns, Root acknowledges an impressive robotaxi event could positively impact the stock.
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