Ford (NYSE:F), General Motors (NYSE:GM) and Chrysler all saw auto sales jump by double digits year-over-year in April, and big-ticket trucks led the charge. Meanwhile, Honda (NYSE:HMC) and Toyota (NYSE:TM) also saw modest gains.
So are auto stocks a buy on this strong news? Maybe not, says Charles Sizemore of the Sizemore Investment Letter.
While there was indeed strong growth in auto sales for April, Charles thinks its more a question of pent-up demand than anything else as Americans continue to drive around clunkers and delay new vehicle purchases.
As such, Charles thinks mass-market car sales aren’t especially encouraging, and that a safe bet would be to think about luxury vehicle brands like Daimler (PINK:DDAIF) that makes the Mercedes-Benz rather than companies that crank out lower-margin compact models for the average Joe.
Check out the video above, and read more about April auto sales below.
- It was the best April for vehicle sales in six years. (NBC News)
- China just made it harder to buy a Bentley. (Quartz)
- Charles picked Daimler as his Best Stock for 2013. (InvestorPlace.com)
Jeff Reeves is the editor of InvestorPlace.com and the author of “The Frugal Investor’s Guide to Finding Great Stocks.” Write him at firstname.lastname@example.org or follow him on Twitter via @JeffReevesIP. As of this writing, he did not own a position in any of the stocks named here.