Ford Stock Near 52-Week Low: Is it a Steal or Still a Risk?

Core Viewpoint - Ford is experiencing significant challenges in the market, with a stock decline of approximately 24% over the past year, while its competitors show mixed performance [1][2]. Financial Performance - Ford's stock closed at $9.33, nearing its 52-week low of $8.44 [1]. - The company's Model e division, focused on electric vehicles (EVs), reported losses widening to $5.07 billion in 2024 from $4.7 billion in 2023, with expectations of a deeper loss of $5-5.5 billion for the full year [10]. - Ford's Ford Blue division is also under pressure, projecting EBIT of $3.5-4 billion in 2025, down from $5.3 billion in 2024 [11]. - The adjusted EBIT for the full year is expected to be between $7 billion and $8.5 billion, a decrease from $10.2 billion in 2024 [14]. - The first-quarter 2025 adjusted EBIT is anticipated to break even, a significant drop from $2.7 billion in Q1 2024 [15]. Market Position and Valuation - Ford's current valuation appears low, with a 12-month forward sales multiple of 0.23, compared to General Motors at 0.24 and Stellantis at 0.15 [7]. - The stock is trading below its 50 and 200-day simple moving averages (SMA), indicating a bearish trend [5]. Tariff Impact - Trump's proposed 25% tariffs on imports from Mexico and Canada are expected to disrupt supply chains and increase costs, potentially harming demand and profits [12][13]. - Ford manufactures about 82% of its vehicles domestically, but only one-third of those are made with domestic parts, making it vulnerable to rising component costs [13]. Dividend Outlook - Ford's high dividend yield of over 6% is attractive, but ongoing tariff pressures may force a reassessment of its dividend policy [16][18]. - The company has a strong liquidity position with $28 billion in cash and $47 billion in total liquidity at the end of 2024, providing a buffer against immediate financial pressures [17]. Future Estimates - The Zacks Consensus Estimate for Ford's 2025 sales and EPS indicates declines of 5% and 27%, respectively, with EPS estimates trending downward over the past 60 days [19][20]. - The company is currently ranked 4 (Sell) by Zacks, indicating a cautious outlook for investors [21].