Ford Motor Company, together with its subsidiaries, designs, manufactures, markets, and services automobiles in North America, South America, Europe, the Middle East and Africa, and the Asia Pacific. More info.
The calculations below outline how an intrinsic value for Ford Motor is arrived at by discounting future cash flows to their present value. We use analyst's estimates of cash flows going forward 5 years.
See our documentation to learn about this calculation.
|Levered FCF (USD, Millions)||$5,080.00||$4,412.47||$3,427.00||$3,947.00||$4,055.74|
|Source||Analyst x5||Analyst x6||Analyst x1||Analyst x1||Extrapolated @ (2.76%)|
Discounted (@ 16.7%)
Present value of next 5 years cash flows:
Terminal Value = FCF2021 × (1 + g) ÷ (Discount Rate – g)
Terminal Value = $4,056 × (1 + 2.3%) ÷ (16.74% – 2.3%)
Terminal value based on the Perpetuity Method where growth (g) = 2.3%:
Present value of terminal value:
Equity Value (Total value) = Present value of next 5 years cash flows + terminal value
Value = Total value / Shares Outstanding ($27,020 / 3,982)
Value per share:
Current discount (share price of $10.93): -61%
The discount rate, or required rate of return, is estimated by calculating the Cost of Equity.
Discount rate = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
Discount rate = 16.74% = 2.33% + (1.879 * 7.67%)
The Levered Beta is the Unlevered Beta adjusted for financial leverage. It is limited to 0.8 to 2.0 (practical range for a stable firm).
Levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
1.879 = 0.561 (1 + (1- 30%) (335.4%))
Levered Beta used in calculation = 1.879
Are Ford Motor's annual earnings growth expected to exceed 3.4% over the next 3 years?
Mr. James Patrick Hackett, also known as Jim, has been Chief Executive Officer and President of Ford Motor Company since May 22, 2017. Mr. Hackett served as the Chief Executive Officer of Steelcase Inc. from 1994 to March, 2014 and served as its President from 1994 to April 22, 2013. He served as Chairman of Ford Smart Mobility LLC at Ford Motor Company from March 2016 to May 22, 2017. Mr. Hackett served as Vice Chairman of Steelcase Inc. until February 27, 2015. He served as the Chairman of Fifth Third BanCorp. and served as its Director at Fifth Third BanCorp since 2001 until April 19, 2016. He has been a Director of Fifth Third bank since 2001 and served as its Lead Director from June 2008 to April 15, 2014. Mr. Hackett serves as a Director of Business Leaders for Michigan. He has been a Trustee of Northwestern Mutual Life Insurance Company, of NML Variable Annuity Account A since 2000. He serves as a Director of Fifth Third Bank. He served as a Director of Ford Motor Company since September 2013 until March 10, 2016. He served as a Director of Steelcase Inc. since 1994 to February 27, 2015. Mr. Hackett served as a Director of Old Kent Financial Corp. since 1995. He is a University of Michigan graduate.
Average tenure of the Ford Motor management team:
Average tenure of the Ford Motor board of directors:
Ford Motor Company, together with its subsidiaries, designs, manufactures, markets, and services automobiles in North America, South America, Europe, the Middle East and Africa, and the Asia Pacific. The company’s Automotive segment develops, manufactures, distributes, and services cars, trucks, SUVs, and electrified vehicles under the Ford name; and luxury vehicles under the Lincoln name, as well as service parts and accessories. This segment markets its products through distributors and dealers, as well as through dealerships to fleet customers, including commercial fleet customers, daily rental car companies, and governments. Its Financial Services segment offers various automotive financing products to and through automotive dealers. Its financing products comprise retail installment sale contracts for new and used vehicles; and direct financing leases for new vehicles to retail and commercial customers, such as leasing companies, government entities, daily rental car companies, and fleet customers. This segment also offers wholesale loans to dealers to finance the purchase of vehicle inventory; and loans to dealers to finance working capital and improvement of dealership facilities, purchase dealership real estate, and other dealer vehicle programs. The company was founded in 1903 and is based in Dearborn, Michigan.
|Name:||Ford Motor Company|
|Market Cap:||$43,523 million|
One American Road, Dearborn, 48126, United States
|Sector:||Automobiles and Components|