Citi maintains buy on Ford, reiterates stock price target

On Wednesday, Citi reaffirmed its buy rating and a $17.00 stock price target for Ford Motor Company (NYSE:F) following the automaker's latest updates on its electric vehicle (EV) product plans. The morning's announcement from Ford included several significant developments.

Firstly, the company has decided to cancel a three-row EV SUV that was previously scheduled for 2027. This model was projected to contribute approximately 58,000 units in 2028, equating to roughly 8% of Ford's total North American EV production.

In addition, Ford disclosed that the first EV from its California-based skunkworks team is slated to be a mid-size pickup truck, expected to launch in 2027. This timeline is slightly delayed compared to S&P's initial forecast of a late-2026 start of production for the Maverick EV. Nonetheless, it aligns with S&P's broader expectations for Ford's ramp-up of new EV offerings starting in 2027.

Moreover, the next generation of Ford's T3 EV truck has had its release pushed back to the second half of 2027, a postponement of about one year from the original 2026 target, according to S&P's predictions. Despite these schedule adjustments, Ford's stock saw a positive movement, increasing by 2% in the morning trading session.

The updates suggest Ford is exercising continued capital discipline, and there could be a potential for reducing near-term losses in the Model-e segment. The impact on suppliers, who are anticipated to benefit from increased content in both hybrid and EV models, is not expected to be significant according to the analyst's comments. Further details and analysis will be provided following a callback with the company.

InvestingPro Insights

In light of Citi's reaffirmed buy rating for Ford Motor Company, the latest InvestingPro data and tips provide additional context for investors considering the automaker's stock. With a market capitalization of $43.05 billion and a forward-looking P/E ratio of 7.41, Ford appears to be valued attractively relative to its earnings. The company's revenue has shown a growth of 6.2% over the last twelve months as of Q2 2024, indicating a steady increase in sales.

InvestingPro Tips underline that Ford pays a significant dividend to shareholders, boasting a robust dividend yield of 7.3% as of the latest data, and has maintained these payments for 13 consecutive years. This consistency is a positive sign for income-focused investors. Moreover, analysts have revised their earnings upwards for the upcoming period, suggesting optimism about the company's future performance.

While Ford's stock price movements have been quite volatile, with a one-month total return of -22.42%, the company remains a prominent player in the Automobiles industry. For investors seeking more detailed analysis and additional InvestingPro Tips, there are 12 more tips available on the InvestingPro platform for Ford Motor Company (https://www.investing.com/pro/F). These insights could be crucial for making informed decisions about investing in the evolving EV market where Ford is actively adjusting its strategy.

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