Which Top Auto Stock Has the Strongest Earnings Trends: Ford, GM, Toyota, Honda or Tesla?

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Earnings trends are extremely important when evaluating stocks. At Wall St. Cheat Sheet, we view increasing earnings quarter-over-quarter as a simple way to gauge whether costs and the business model are stable. Then we like to analyze whether the company is outperforming peers in the sector. This is what we call the “E-Squared” investment analysis (‘E = Earnings Are Increasing Quarter-Over-Quarter’ + ‘E = Excellent Relative Performance Versus Peers and Sector’).

Stocks with improving earnings metrics are worthy of your extra attention. Click here to discover our CHEAT SHEET stock picks now!

Here’s your Cheat Sheet to how the top 5 auto stocks rank via earnings trends:

Ford Motor Co. (NYSE:F): Current Price $13.07

Fiscal Year 2008 2009 2010 2011 2012
Revenue ($) in millions 143,580 116,280 128,950 136,260 134,300
Diluted EPS ($) -6.50 0.86 1.66 4.94 1.42

Although revenue has picked up somewhat since 2009, EPS fell to the floor in 2012 after a promising 2011.

Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter Dec. 31, 2011 Mar. 31, 2012 Jun. 30, 2012 Sep. 30, 2012 Dec. 31, 2012
Revenue ($) in millions 34,580 32,440 33,210 32,170 36,500
Diluted EPS ($) 3.33 0.35 0.26 0.41 0.40

Revenue looks pretty stable, and has improved a bit over the past two quarters. EPS, however, took a major dive in March, and has subsequently stayed pretty flat over the past two quarters. Let’s keep looking…

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