Ford Motor Co. manufactures automobiles under its Ford and Lincoln brands. In March 2022, the company announced that it will run its combustion engine business, Ford Blue, and its BEV business, Ford Model e, as separate businesses but still all under Ford Motor. The company has nearly 13% market share in the United States, about 10% share in the UK, and under 2% share in China including unconsolidated affiliates. Sales in the US made up about 68% of 2024 total company revenue. Ford has about 171,000 employees, including about 56,500 UAW employees, and is based in Dearborn, Michigan.
Buy
In 2024, Ford reported $184.99 billion in revenue (up 5%) and $5.88 billion in earnings (up 35.24%). With a market cap of ~$37.66 billion, it employs ~173,000 people and is a leader in trucks (e.g., F-150) and commercial vehicles.
Undervaluation: Ford’s P/E ratio is 6.36 (trailing) and 7.50 (forward), well below the S&P 500’s ~20, indicating a bargain. Its intrinsic value is estimated at $16.18, suggesting a 42% undervaluation at ~$9.46.
High Dividend Yield: Ford offers a 7.72% dividend yield ($0.75 annually), with supplemental dividends, appealing for income investors. It targets returning 40-50% of free cash flow to shareholders.
Ford Pro Growth: The commercial segment (Ford Pro) generated $7.22 billion in EBIT in 2023 with a 12.4% margin, outpacing Ford Blue’s 7.3%. Software subscriptions grew 50% year-over-year, signaling strong recurring revenue potential.2
EV and Quality Improvements: Ford’s F-150 Lightning is a top-selling electric truck, and quality enhancements (9th in J.D. Power’s 2024 Initial Quality Study) may reduce warranty costs over time.