Investors Are Actively Looking Into Ford Motor Company (F): Essential Information You Should Be Aware Of

Ford Motor Company: Key Insights for Investors

Ford Motor Company (F) has recently attracted significant attention from investors, ranking among the most searched stocks on Zacks.com. If you're considering this stock, it's important to examine several critical factors that could impact its near-term performance.

Recent Stock Performance

In the past month, Ford's shares have risen by 2.9%, outpacing the Zacks S&P 500 composite, which gained 0.6%. In contrast, the Zacks Automotive - Domestic sector, which includes Ford, declined by 4.9% during the same period. This raises the question: what might be next for Ford's stock?

What Drives Stock Movements?

While news or speculation about major changes in a company's outlook can quickly move its share price, long-term investors typically focus on fundamental factors when making decisions.

Earnings Forecast Revisions

Zacks places strong emphasis on changes in projected earnings, as these are seen as the main driver of a stock's fair value. Analyst updates to earnings estimates, reflecting the latest business trends, often lead to stock price adjustments. When consensus earnings estimates rise, the stock's perceived value increases, which can attract buyers and push the price higher. Research shows a close link between shifts in earnings forecasts and short-term price movements.

• For the current quarter, Ford is expected to earn $0.22 per share, a 57.1% increase from the same period last year. However, the consensus estimate has dropped by 28.1% in the past month.
• For the full fiscal year, the consensus estimate is $1.52 per share, up 39.5% year-over-year, with a slight decrease of 0.5% in the last 30 days.
• Looking ahead to next year, analysts expect $1.80 per share, a projected increase of 18.8% from this year, though the estimate has declined by 1.3% over the past month.

With a strong track record verified by external audits, the Zacks Rank system is a reliable indicator of short-term price trends, leveraging earnings estimate changes. Currently, Ford holds a Zacks Rank #2 (Buy), based on recent estimate revisions and other key factors.

Forward 12-Month EPS Trend

Revenue Growth Outlook

While earnings growth is a strong sign of financial health, sustained revenue growth is essential for long-term profitability. Understanding Ford's sales outlook is therefore important:

• This quarter's consensus sales estimate is $39.56 billion, up 5.7% from a year ago.
• For the current and next fiscal years, sales are projected at $175.03 billion and $175.12 billion, representing increases of 0.6% and 0%, respectively.

Recent Results and Earnings Surprises

In the latest quarter, Ford reported $42.5 billion in revenue, a 5.3% decrease year-over-year. Earnings per share were $0.13, compared to $0.39 in the prior year. These results beat the consensus revenue estimate by 3.27%, but EPS fell short by 23.53%. Over the past four quarters, Ford exceeded consensus EPS estimates twice and surpassed revenue estimates in all four periods.

Valuation Overview

Evaluating a stock's valuation is crucial for making informed investment decisions. Comparing Ford's current valuation ratios—such as price-to-earnings, price-to-sales, and price-to-cash flow—to its historical averages and to industry peers helps determine if the stock is undervalued, fairly valued, or overvalued.

The Zacks Value Style Score, which assesses both conventional and alternative valuation metrics, rates stocks from A (best) to F (worst). Ford currently receives an A, indicating it is trading at a discount compared to its peers.

Conclusion

The analysis above, along with additional resources on Zacks.com, can help you decide whether Ford Motor deserves your attention. With a Zacks Rank #2, Ford is expected to outperform the broader market in the near term.