Stock Analysis

A Revitalization of Growth for the Ford Motor Company (NYSE:F)

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Ford Motor Company (NYSE:F) had a rough few years, with revenue decreasing and the management cutting dividends temporarily. Today, Ford is striving to optimize the business and re-discover growth from EV and traditional vehicles. As the stock's performance is based on the future, we will examine how the market and analysts view the company.

In the last quarter, Ford posted the expected revenues of US$33b, however the company did surprise by delivering a profit of US$0.45 per share, an impressive 116% above what was forecast.

The financial picture is even better when we look underneath, and see that both free and operating cash flows are ahead of earnings. This can sometimes be a leading indicator for a substantial rise in future profits, because they tend to rise to the level of free cash flows. 

We can get the full picture by looking at analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Ford Motor

NYSE:F Earnings and Revenue Growth December 16th 2021

Taking into account the latest results, the consensus forecast from Ford Motor's 14 analysts is for revenues of US$145.3b in 2022, which would reflect a 7.9% improvement in sales compared to the last 12 months.

Statutory earnings per share are predicted to surge 153% to US$1.82. Before this earnings report, the analysts had been forecasting revenues of US$144.8b and earnings per share (EPS) of US$1.77 in 2022.

Ford has benefited from increased vehicle pricing and auto demand. Considering the future, they are focused on optimizing operations as well as taking advantage of the EV auto credits that will be extended in the U.S.

The consensus price target recently rose 5.8% to US$19.66, suggesting that higher earnings estimates flow through to the stock's valuation. The stock is currently trading @$20.58, above the target, showing that investors are willing to risk the upside.

That's not the only conclusion we can draw from this data, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions, with the most bullish analyst valuing it at US$23 and the most bearish at US$12 per share.

When looking at the future, it is also good to compare with industry metrics. Ford Motor's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 6.3% growth to the end of 2022. By contrast, our data proposes, that other companies in a similar industry are forecast to see their revenue grow 31% per year. This means that while growth is increasing, other companies may be accelerating faster on the market.

Key Takeaways

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Ford Motor's earnings potential next year.

The traditional auto industry is also moving in to the EV space, and large manufacturers like ford will have the ability to leverage their production capacities, experience, brand name and other features that will give them an edge with their customers.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Ford Motor analysts - going out to 2023, and you can see them free on our platform here.

Before you take the next step you should know about the 3 warning signs for Ford Motor (1 shouldn't be ignored!) that we have uncovered.

What are the risks and opportunities for Ford Motor?

Ford Motor Company develops, delivers, and services a range of Ford trucks, commercial cars and vans, sport utility vehicles, and Lincoln luxury vehicles worldwide.

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  • Trading at 35.8% below our estimate of its fair value

  • Earnings are forecast to grow 39.27% per year


  • Debt is not well covered by operating cash flow

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Simply Wall St analyst Goran Damchevski and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Goran Damchevski

Goran Damchevski

Goran is an Equity Analyst and Writer at Simply Wall St over 4 years of experience in financial analysis and company research. Personally, Goran has over 4 years of experience in financial analysis and company research, where he previously worked in a seed-stage startup as a capital markets research analyst and product lead and developed a financial data platform for equity investors. 

About NYSE:F

Ford Motor

Ford Motor Company develops, delivers, and services a range of Ford trucks, commercial cars and vans, sport utility vehicles, and Lincoln luxury vehicles worldwide.

Undervalued with adequate balance sheet.