Shares of Vietnamese EV (electric vehicle) maker VinFast Auto (NASDAQ:VFS) closed 68.45% higher on its stock market debut. Given the jump in its price, VinFast’s equity value reached nearly $85 billion, much higher than the market caps of General Motors (NYSE:GM) and Ford Motor Company (NYSE:F). Based on their closing prices on August 15, GM and Ford stocks command a market cap of $46.29 billion and $47.93 billion, respectively.
VinFast went public through a special purpose acquisition company (SPAC), Black Spade. The business combination valued VinFast at $23 billion. Thanks to the surge in its price, VinFast also became the largest Vietnamese company (by market cap) listed on the American exchange.
The company had delivered nearly 19,000 EVs as of June 30, 2023. Further, it plans to roll out next-gen EVs and expand its footprint globally. The company is leveraging its partnerships with distributors and dealers to expand in North America, Europe, and Southeast Asia. Moreover, to strengthen its supply chain, the company broke ground at its new EV manufacturing facility in the U.S.
Though VinFast is eyeing global expansion, the EV market has become highly competitive, with market leader Tesla (NASDAQ:TSLA) lowering its average selling price to push volumes. Tesla’s move has compounded challenges for smaller players that are not yet profitable. VinFast, which is yet to achieve profitability, saw its stock decline by 14.19% in after-hours trading.
Whether VinFast stock will be able to sustain the gains remains to be seen. Meanwhile, General Motors and Ford are under pressure due to growing concerns over labor costs. Against this backdrop, let’s look at analysts’ forecasts for GM and Ford stock.
Is GM Stock Expected to Rise?
General Motors stock has underperformed the broader market averages so far this year. Further, the company is negotiating a new labor contract with the United Auto Workers, which adds uncertainty over its future labor costs.
Given the near-term challenges, analysts are cautiously optimistic about GM stock. With seven Buys, six Holds, and two Sells, General Motors stock sports a Moderate Buy consensus rating. However, analysts’ 12-month average price target of $50.27 reflects a significant upside potential of 50.96% from current levels.
How High is Ford Stock Expected to Go?
Based on analysts’ 12-month average price target of $15.18, Ford stock is expected to rise 26.71% from current levels. Nevertheless, the uncertainty related to the new labor contract and declining price premiums for EVs keep analysts sidelined.
Ford stock has received seven Buy, Seven Hold, and three Sell recommendations, translating into a Hold consensus rating.
