Shares of Ford Motor (NYSE:F) took a sharp dive on Tuesday, sliding 3.8% and closing at $9.58, after hitting an intraday low of $9.59. This decline follows a downward trend that has seen Ford struggle to maintain its footing in a volatile market. Trading volume also saw a notable drop, with 61.3 million shares exchanging hands—29% lower than the average daily volume of 86.7 million shares.
Analysts Downgrade Ford Stock, Target Price Adjustments Follow
Ford Motor has been the subject of numerous research reports, many of which indicate growing concerns over the automaker’s performance. Jefferies Financial Group issued a downgrade, moving Ford’s rating from “hold” to “underperform” and slashing its price target from $12.00 to $9.00. Royal Bank of Canada echoed this sentiment, adjusting its price target from $10.00 to $9.00, while Evercore ISI revised its target down from $11.00 to $10.00.
However, JPMorgan Chase & Co. maintained a more optimistic outlook, setting a target price of $13.00, down from $14.00, and retaining an “overweight” rating. Wolfe Research remains bearish, reaffirming its “underperform” rating. Overall, Ford’s stock holds a “Hold” consensus rating, with three analysts recommending a sell, eleven suggesting a hold, and four rating it as a buy. The average price target stands at $11.77.
Key Financial Metrics and Stock Performance
Despite the downturn, Ford Motor maintains a market capitalization of $38.47 billion. Its valuation metrics include a P/E ratio of 6.65, a PEG ratio of 0.61, and a beta of 1.59, indicating moderate volatility. The stock’s 50-day simple moving average stands at $9.72, while its 200-day simple moving average is $10.37—signaling an ongoing downtrend.
The automaker reported its latest earnings on February 5th, posting $0.39 earnings per share (EPS), surpassing analysts’ expectations of $0.35. Ford’s net margin came in at 3.18%, with a return on equity of 16.88%. For the full fiscal year, analysts project earnings per share of 1.47.
Ford’s Dividend: A Bright Spot Amidst Market Challenges?
Ford continues to reward shareholders with a quarterly dividend of $0.15 per share, paid on March 3rd. The dividend equates to an annualized payout of $0.60, offering a 6.18% yield—a notably high return for income investors. The company’s payout ratio is currently 41.10%, indicating a sustainable dividend policy despite the broader market challenges.
Institutional Investors Adjust Holdings
Institutional investors have been actively modifying their stakes in Ford Motor, reflecting mixed sentiment about the company’s future. Principal Financial Group Inc. increased its position by 3.8%, bringing its holdings to 4.39 million shares valued at $46.4 million. Portside Wealth Group LLC raised its stake by 19.8%, acquiring 13,161 shares. Atria Investments Inc. also increased its position, now holding 308,901 shares worth $3.26 million.
Meanwhile, CWA Asset Management Group LLC and Covestor Ltd have also expanded their holdings, while other firms, particularly hedge funds, remain cautious. Institutional investors collectively own 58.74% of Ford Motor’s stock.
What’s Next for Ford?
As Ford navigates economic headwinds, shifting consumer demand, and heightened competition in the EV market, investors are closely watching for signs of stabilization. With the stock trading below its 200-day moving average and price targets being revised downward, the upcoming earnings report and strategic moves by management will be crucial in determining its trajectory.
