Ford stock (NYSE:F) is rallying this morning as the company released strong Q3 results, highlighting more financial flexibility including a returning dividend. More recently, Ford stock has attracted attention from new investors as Ford plan to invest up to $45 Billion in Electric Vehicles and Autonomous integration over the next 5 years.
As a result, the stock has jumped 82% year-to-date and is currently trading 216% higher than its trading level in March 2020. Moreover, since the companies struggle during the pandemic alongside semiconductor supply constraints, Ford finally plan to bring back their dividend. In this article we will breakdown everything you need to know regarding the Ford stock forecast following its strong Q3 performance.
Ford beats previous quarter revenue by 33%
In the third quarter of 2021, Ford reported revenues of $35.7 Billion, an increase of 33% compared to Q2. The key driver in improved revenues were correlated with greater semiconductor availability and wholesale vehicle shipments according to Ford. In particular, with semiconductor supply woes easing in North America Ford saw regional product shipments increase by 67% Q-o-Q.
The good news for investors is Ford’s CEO Jim Farley is confident that Ford is “spring-loaded” for further growth in North America as the semi-conductor crisis eases. As for Europe, Ford’s revenue increased by 7% year-on-year to $6.1 Billion. This trend in Europe has remained strong throughout the first three quarters of 2021, with the company generating $18.7 Billion YTD.
How are Ford Electric Vehicles performing?
The two electric vehicle models expected to drive strong demand are the Ford Mustang Mach-E and F-150 Lightning truck. According to Morgan Stanley analysts Ford’s EV Mustang Mach-E has recently stolen market share from Tesla’s Y Model.
In Q3, Ford noted overwhelming demand for the companies All Electric F-150 pick-up truck, which now has over 150,000 pre-orders. This has resulted in Ford doubling their manufacturing output of the F-150 pickup truck to 80,000 vehicles a year.
“We knew the F-150 Lightning was special, but the interest from the public has surpassed our highest expectations and changed the conversation around electric vehicles. So we are doubling down, adding jobs and investment to increase production,”said Bill Ford, executive chair, Ford Motor Company.
As for the Mustang Mach-E, its retail sales expanded by 9.2% in September, delivering 18,855 Mach-E’s. The Mach-E currently ranks second in full electric SUV sales behind Tesla’s Model Y.
Ford stock dividend returns – here’s what you need to know
As to the surprise of many investors, Ford’s board of directors recently voted to reinstate a regular quarterly dividend starting next quarter. This will mark the first dividend paid to common stock shareholders since March 2020. The fourth quarter dividend will be $0.10 per share on outstanding common and Class B stock, which will be paid on December 1 to shareholders. It is worth noting that the cutoff date will be on November 19.
Interestingly, the companies reinstatement of its well renowned dividend will provide a unique opportunity for Electric Vehicle investors. Majority of the big players of the EV market including the likes of Tesla and NIO do not pay dividends. Although Ford still is heavily staked in petroleum/diesel engines, they will continue to progress in the EV game as the Mach-E and the F-150 pickup truck will challenge the untouched market share that Tesla dominates in North America. This can provide investors with unique exposure to EV’s as well as paid dividends.
Wallstreet analyst boosts Ford Stock Forecast valuation
Following the Q3 results, Benchmark analyst Michael Ward raised the firm’s price target on Ford to $20 maintaining a Buy rating. Ward noted Ford beat expectations in Q3, which saw Ford turn cash positive and a reinstate the companies dividend. The analyst’s increased valuation is derived from increased sales estimates for both 2021 and 2022 according to theFly. The analysts target represents a 31% upside from the current trading price.
The Bottom Line – Ford Stock Forecast
Overall, the Q3 results point towards a strong finish to the calendar year as semiconductor woes have begun to ease in North America. The reinstatement of the dividend will re-attract the companies dividend investors while also providing a unique opportunity for EV investors to have exposure to the EV segment and dividends simultaneously.
The Ford stock forecast has also been positively impacted by the companies improved guidance. Ford boosted the full-year 2021 adjusted earnings before interest & tax (EBIT) to $10.5 billion-$11.5 billion.
The information above is strictly for informational purposes only and is not financial advice nor does it constitute a recommendation. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.
Follow us on Google News here to get minute-by-minute updates on when we post on any device via the Google News App.
Looking to start trading in Australia or the UK?
Do you live in Australia or the United Kingdom and looking to invest in the US market? Good news! We’ve partnered with Stake. Trade 4,500+ US stocks and ETFs with $0 brokerage and no fx fees per trade. Use our code “YIG” to receive a free stock when funding your new account.
In addition, Stake is one of the leading US trading platforms for Australian and UK investors. Click hereto start trading US stocks with a streamline trading experience. Lastly, for more information on our referral program and how it works click here.