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We remain positive on the US car manufacturer as a play on the electric vehicle revolution and the development of autonomous driving

Ford Motor (F:NYSE) $12.85

Gain to date: 84%

Original entry point: Buy at $6.99, 13 August 2020

Our bullish call on Ford (F:NYSE) looks increasingly canny with shares in the Jim Farley-steered car maker having motored 84% higher from our entry price.

Investors are increasingly positive about Ford’s investments in areas such as electric and autonomous vehicles and as economic activity recovers post-pandemic, Ford should see increased sales for its cars and pickup trucks.

One near-term negative is that in common with other auto makers such as General Motors and Stellantis, Ford is feeling the impact of the global semiconductor shortage; it recently warned lost production due to the chip shortage could lower this year’s earnings by $1 billion to $2.5 billion.

Nevertheless, Ford’s shares surged earlier this month after Barclays upgraded the stock from ‘equal weight’ to ‘overweight’ and upped its price target from $9 to $16. The investment bank is growing more comfortable with the margin improvement outlook at Ford and is enthused by its clearer electric vehicle strategy.

SHARES SAYS: Keep buying Ford for the upside to come from electric vehicles and as a post-pandemic reopening play. 

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