Riding the Bull
Shooting up the ranking to Zacks Rank #1 (Strong Buy), Ford Motor’s F stock finds itself in the spotlight as the Bull of the Day. Following a surge of +9% year to date and breaching its 200-day moving average, Ford is on a roll in the stock market.
Fortified Profitability & Attractive Valuation
Before the pandemic hit, Ford had laid a sturdy foundation for its profitability. The company’s efforts bore fruit once supply chain disruptions eased, leading to $2.01 per share in multi-year EPS peaks last year. Although a slight deceleration in Ford’s earnings growth is anticipated, recent earnings estimate revisions for both FY24 and FY25 have been on the upswing.
EPS Value & Industry Comparisons
Ford’s stock currently trades at $13, offering a modest 6.9X forward earnings multiple, rendering it a bargain compared to its historical high of 16.5X forward earnings. Furthermore, this valuation is notably below the median of 7.3X. Ford’s stock also stands as an attractive option when stacked against its industry peers, including General Motors (GM).
Discounted Price to Sales Ratio
At a P/S ratio of 0.31X, Ford’s stock showcases a compelling valuation level, comparable to General Motors’ 0.29X, and comfortably beneath the benchmark of less than 2X. With Ford’s revenue projected to see a slight uptick to $166.3 billion this year, the company is poised for growth in the sales department.
Electric Evolution
Ford’s foray into the electric vehicle (EV) market has been nothing short of spectacular, with a 27% surge in EV sales last quarter, hitting record highs. Driven by soaring demand for models like Mustang Mack-E, F-150 Lightening, and E-Transit, Ford’s EV sales boost has defied market expectations, outshining even dominant players like Tesla (TSLA).
Looking Ahead
With Ford’s stock showing promising signs of a continued upswing, the time seems ripe for investors to seize the opportunity. The confluence of Ford’s appealing valuation and expanding EV segment paints a bright future for the auto giant, making it a potentially rewarding addition to any investment portfolio.