(Reuters) - Goldman Sachs said it prefers Ford Motor Corp (>> Ford Motor Company) over General Motors Co (>> General Motors Company) and downgraded the largest U.S. automaker's stock to "neutral" from "buy", citing slowing growth in China and the United States.

Goldman upgraded Ford to "buy" from "neutral", saying Ford's North America profitability is likely to meaningful grow next year, while GM's is likely to decline slightly through 2018 after having peaked this year.

While the prospects for growth in China have worsened for both companies, Ford is less dependent on China than GM, Goldman wrote in a note to clients.

The brokerage cut its price target on GM stock by $7 to $40.

GM's shares were down 0.9 percent at $35.98 in trading after the bell. Ford's shares were up 1 percent at $15.45.

Up to Tuesday's close, GM's shares had fallen nearly one percent in the past one year, Ford's had fallen 9.4 percent.

(Reporting by Sweta Singh in Bengaluru; Editing by Savio D'Souza)

Stocks treated in this article : Ford Motor Company, General Motors Company