During the financial crisis, the U.S. auto industry really took it on the chin. Two of the Big Three automakers filed for bankruptcy in 2009.#-ad_banner-#​

Since then, the industry has come roaring back, with 2013 expected to mark the fifth consecutive year of industrywide sales growth in the U.S. 

Yet, what many investors in the sector are missing is that the industry’s true growth story lies beyond U.S. shores. I’m talking about the rise of the middle class in emerging markets. 

One of the companies best positioned to take advantage of this also happens to be the only one of the Big Three to avoid bankruptcy in 2009. This automaker also happens to be well-positioned in emerging markets, namely China and India, and it also has a stronghold in Europe, which could be one of the best turnaround stories of 2014. 

This company is Ford (NYSE: F), America’s second-largest automaker. Over the past three years, Ford and the largest U.S. automaker, GM (NYSE: GM), had essentially traded in lockstep — but there’s been a large deviance from the status quo in the past month. Ford’s growth prospects remain robust, but the stock is now trading at a hefty discount to GM. That’s offering investors an attractive entry point. 

Ford appears to be underperforming its top peer as its top management is in limbo. Will CEO Alan Mulally stick around? There’s talk that Mulally could be a top candidate for the CEO job at Microsoft (Nasdaq: MSFT). Wherever Mulally ends up, Ford has a number of growth levers that will be pulled in 2014 — and the market appears to be missing that aspect.

Ford is continuing to gain strength, with November being a relatively solid month. Sales volumes at the flagship Ford and luxury Lincoln brands were up 7% and 17% year over year, respectively.

	Flickr/MSVG
	Ford’s One Plan will involve revamping its models and introducing new models altogether, which should include a completely remodeled F-150 pickup, with a smaller gasoline engine and an all-aluminum body, for model year 2015.

For 2014, the biggest story for Ford is likely to be continued growth in emerging markets such as China and a turnaround in its Europe operations. Ford’s companywide margins have been held down by losses in Europe, but that segment is expected to finally return to profitability by 2015.

The long-term goal is to get the operating margin in Europe up to between 6% and 8%. What’s more, Ford tends to dominate GM in Europe: Ford has over 20% of the market share in the region, compared with less than 14% for GM. 

Turning back to the U.S., it’s no secret that there’s a high level of pent-up demand among American consumers for new cars. With loosening credit markets and the potential for higher employment in 2014, more consumers should look to replace their aging cars. The average age of vehicles on the road in the U.S. is now over 11 years old, an all-time high. 

Ford and GM continue to fight it out in the U.S. for the top market spot among the Big Three automakers. To bolster interest in its brands, Ford has introduced its One Plan, which will involve revamping its models and introducing new models altogether. Part of this includes a completely remodeled F-150 pickup, with a smaller gasoline engine and an all-aluminum body, for model year 2015. 

As part of its growth plan for major emerging markets, Ford is turning its focus to Asia, which is expected to account for some 70% of Ford’s global growth over the next decade. China and India are expected to make up 40% of Ford’s vehicle sales over the next half decade, and global sales are forecast to jump to 8 million vehicles by 2015, a jump of more than 50% from current levels. 

Don’t forget that Ford pays a 2.6% dividend yield, which amounts to a payout of less than 30% of earnings. In comparison, GM doesn’t pay a dividend at all. 

Risks to Consider: The biggest risk lies in that Ford is fairly dependent on a strengthening broader economy. In addition to that, Europe will play a big part of the turnaround story, so any slip in a recovery there could weigh on Ford’s stock. 

Action to Take –> On the high end of Ford’s projected 2014 earnings per share (EPS), the upside could be to over $19, or close to 25% from current prices. Ford’s current price-to-earnings (P/E) ratio of about 10 is in line with its historical average but still well below GM’s P/E of just under 17. 

P.S. Did you know that StreetAuthority’s research staff recently named Ford as one of its Top 10 growth stocks? You can get this report absolutely free, just by signing up for our premium newsletter Top 10 Stocks. You’ll also receive our exclusive report on the absolute best stocks on the market to own in 2014. To learn more, click here now.