Is Ford The Cheapest Stock In The Market?

Zinger Key Points
  • Ford and General Motors have both fallen about 35% year-to-date.
  • Jim Lebenthal says, "both stocks deserve to have higher multiples than 6 to 7."

CNBC screened stocks in search of the cheapest buying opportunities in the market, and Ford Motor Co F topped the list.

What To Know: To qualify as one of the cheapest stocks in the market in the aforementioned search, a stock must have a forward price-to-earnings multiple below 17.38. According to data from Benzinga Pro, Ford is currently trading around 6.6 times forward earnings. 

Furthermore, the forward earnings multiple must be at least 50% below average valuation over the last five years. Lastly, earnings per share must be expected to increase or fall by no more than 5% in 2022. 

Why It Matters: Cerity Partners' Jim Lebenthal owns competitor General Motors Co GM instead of Ford, but he couldn't deny that Ford stock looks attractive.

"I like what Ford is doing with the electric vehicle business," Lebenthal said Tuesday on CNBC's" Fast Money Halftime Report."

"Now the electric vehicle business, and in GM's case autonomous vehicles, is why both stocks deserve to have higher multiples than 6 to 7, which is their historical range."

The automakers' legacy businesses are going through a period of high demand and low supply, which should help them to clean up their balance sheets, Lebenthal said: "So these stocks should do well for the foreseeable future."

From Last Week: If You Invested $1,000 In General Motors When Mary Barra Became CEO, Here's How Much You'd Have Now

F, GM Price Action: Ford and General Motors have both fallen about 35% year-to-date.

At press time, Ford was up 1.49% at $13.66, while GM was up 0.05% at $37.85.

Photo: courtesy of Ford.

Posted In: CNBCJim LebenthalLong IdeasTrading Ideas

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