Finding opportunities that offer considerable returns in the fast-paced world of investing demands astute awareness of changing market circumstances. Three prominent participants are noticeable as they look out into the stock market. The first one, an automotive behemoth, continues to command the U.S. automobile industry. The company’s trajectory is poised for growth, with solid sales and a grip on profitable segments like SUVs and trucks.
The second is a company well-known for its automotive heritage. Its strategic plan also moves toward profitability and efficiency. The company wants to improve its financial performance by focusing on capital efficiency and achieving remarkable returns on invested capital (ROIC) as it navigates the changing electric mobility market.
The third one emerges as a leader in connectivity. The company is capitalizing on its investments in network infrastructure to rule the era of fiber technologies and 5G. All three industry heavyweights may benefit from new industrial developments. This makes them attractive investments for anyone looking to ride the wave of recovery in the upcoming years.
General Motors (GM)
General Motors (NYSE:GM) sales figures in the U.S. market demonstrate its lead over capturing demand. The company’s sales surpassed its peers in 2023. The company has improved its market share by achieving solid annual sales growth for all U.S. brands. According to J.D. Power, GM maintained the industry lead in initial quality for a second year and led the sector in sales of full-size SUVs, full-size vans and pickup trucks combined for ten years.
Furthermore, these vehicles usually derive higher average transaction prices (ATPs) and add considerably to General Motors’ total earnings. Moreover, General Motors has plans to invest between $10.5 billion and $11.5 billion in capital expenditures. This includes joint ventures for producing battery cells to support its strategic investments in electric vehicles (EV) and battery manufacturing.
Finally, in 2024, the company may build between 200,000 and 300,000 EVs based on its Ultium EV platform in North America. General Motors focuses on the functionality and styling of the forthcoming EV cars. These include the Chevrolet Blazer EV and Cadillac LYRIQ. Therefore, these developments highlight General Motors’ resolve to shift to EVs and take advantage of their rising demand.
Ford (F)
Ford (NYSE:F) wants to increase capital efficiency by raising the bar on expected returns for authorized initiatives and cutting investments only when necessary. Over the following four years, Ford hopes to increase the total adjusted ROIC from around 14% in 2023 to 20%. Investments are guaranteed to meet strategic goals and provide long-term, sustainable growth by emphasizing capital efficiency and return optimization.
Additionally, Ford’s EV strategy is centered on economics, and the company plans to turn a profit within the first year of selling next-generation EV vehicles. Throughout the lifespan of EVs, the business aims for mid to high-single-digit EBIT profit margins to ensure returns above capital costs.
Ford Pro, committed to comprehending and providing for business clients, announced a noteworthy 19% increase in sales in 2023. With a margin of 12.4%, the segment’s EBIT of $7.2 billion was more than double that of the prior year. Overall, Ford Pro’s triumph may be attributed to its solid array of products, encompassing Super Duty trucks and Transit vans, in addition to premium services that augment the efficiency of its clientele.
AT&T (T)
AT&T (NYSE:T) has made sharp investments in its network infrastructure, especially fiber and 5G technologies. Moreover, as of 2023, over 210 million people will be covered by the mid-band 5G spectrum. This broad coverage highlights AT&T’s focus on providing its consumers with dependable, high-speed connections, which promote customer satisfaction and loyalty. During Q4, AT&T added 526,00 postpaid phone net customers in the mobility category. Hence, this brings the total net additions for 2023 to nearly 1.7 million.
Further, the company has historically low churn rates and continuous solid average revenue per user (ARPU) growth. This reflects AT&T’s capability to attract and retain high-value customers, as demonstrated by the steady increase in postpaid phone subscribers.
As of 2023, AT&T’s fiber network may have expanded to over 26 million consumer and commercial sites to reach 30 million locations by 2025. In short, this is a solid target. Because of the company’s vast fiber infrastructure, AT&T has provided high-speed internet services to increasing customers, which may continue to boost topline and profit margins.
As of this writing, Yiannis Zourmpanos held long positions in T. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
