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Ford (F) Q2 US EV Sales Trail Only Tesla: Buy The Stock Now?
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It seems that the whole narrative of a cooling electric vehicle (EV) market might just have been a tad bit exaggerated. At least, that’s what we can draw from second-quarter EV sales in the United States. Most of the auto biggies reported impressive U.S. EV deliveries.
The e-mobility giant Tesla (TSLA - Free Report) delivered 443,956 cars worldwide in the second quarter, beating analysts’ expectations of 439,000 as compiled by FactSet. Just behind Tesla was the legacy automaker, Ford (F - Free Report) , in terms of EV sales in the United States in the June end quarter. It was the #2 EV brand in the country, topping its crosstown rival General Motors (GM - Free Report) , which itself reported record EV deliveries in the quarter under discussion.
While high prices and inadequate charging infrastructure remain concerns for zero-emission vehicles, the outlook for the EV market is more optimistic than previously believed. The long-term future of mobility clearly leans toward electrification. And Ford is making considerable strides to maintain a strong footing in the EV market.
In this write-up, we will take a look at Ford's robust EV sales, explore the factors likely to drive Ford in the long term and assess whether now is a good time to invest in its shares.
Ford’s Impressive Q2 EV Deliveries
The company sold 23,957 EVs in the second quarter of 2024 in the United States, marking a 61% jump year over year. In terms of models, sales of Mustang Mach E, F-150 Lightning and E-Transit totaled 12,645, 7,902 and 3,410 units, up 46%, 77% and 96%, respectively. Notably, F-150 Lightning remains America’s top-selling electric truck and E-Transit is the nation’s best-selling electric van.
In the first half of 2024, Ford delivered more than 44,000 EVs in the country, nearly 72% up on a yearly basis. Ford's growth allowed it to maintain a lead over GM in the U.S. EV market. GM delivered 21,930 EVs in the second quarter, bringing its total to 38,355 for the first half of 2024.
Ford Model e Unit Poised for Long-Term Growth
Ford's EV segment is strategically positioned for robust growth through a multifaceted approach. Key strategies include scaling, leveraging digital capabilities for manufacturing efficiency and emphasizing vertical integration by insourcing critical components. The company aims to increase integration by nearly 50% in next-gen utility vehicles. Addressing the substantial cost of batteries, Ford is prioritizing energy efficiency and aims for one of the lowest-cost batteries assembled in the United States.
Ford Blue & Pro Units Also Spark Optimism
In the Ford Blue segment, the company has tremendous growth opportunities, particularly with highly coveted models such as the F-150, the Maverick, the Bronco, and, undoubtedly, the Mustang. A wave of new products, including the new F-150, the Ranger, a brand-new Explorer, and Expedition and Navigator will boost revenues.
As for the Ford Pro segment, strong order books, increasing demand signals and the successful launch of the all-new Super Duty sets the stage for a highly promising future. The segment is well-positioned to leverage these factors, driving significant growth. We expect adjusted EBIT from the segment to increase 24.3% year over year in 2024, driven by favorable mix and volume strength.
Price Performance & Valuation
With shares down around 15% year to date, it might be an opportune time to buy the dip on the back of strong fundamentals.
Image Source: Zacks Investment Research
The company is trading cheap compared to the industry and carries a Value Score of A. F’s forward sales multiple sits at 0.31.
Image Source: Zacks Investment Research
Ford is Worth Buying Now
Although the Ford Model e unit is set to suffer losses this year, long-term prospects are promising enough. The Ford+ plan, emphasizing profit growth, e-mobility, and customer satisfaction, shows promise. High liquidity of more than $43 billion provides a solid foundation for investment in Ford+ priorities. To investors’ delight, the company targets distributions of 40-50% of FCF going forward, demonstrating its commitment to shareholder return. Amid all these tailwinds, the stock is witnessing northbound estimates for 2024 and 2025.
Image Source: Zacks Investment Research
Ford is trading above its 50-day and 200-day averages, indicating bullishness.
F Above 50 & 200 Day SMA
Image Source: Zacks Investment Research
Investors should consider parking their cash in Ford at its current price levels for solid long-term returns.
Image: Bigstock
Ford (F) Q2 US EV Sales Trail Only Tesla: Buy The Stock Now?
It seems that the whole narrative of a cooling electric vehicle (EV) market might just have been a tad bit exaggerated. At least, that’s what we can draw from second-quarter EV sales in the United States. Most of the auto biggies reported impressive U.S. EV deliveries.
The e-mobility giant Tesla (TSLA - Free Report) delivered 443,956 cars worldwide in the second quarter, beating analysts’ expectations of 439,000 as compiled by FactSet. Just behind Tesla was the legacy automaker, Ford (F - Free Report) , in terms of EV sales in the United States in the June end quarter. It was the #2 EV brand in the country, topping its crosstown rival General Motors (GM - Free Report) , which itself reported record EV deliveries in the quarter under discussion.
While high prices and inadequate charging infrastructure remain concerns for zero-emission vehicles, the outlook for the EV market is more optimistic than previously believed. The long-term future of mobility clearly leans toward electrification. And Ford is making considerable strides to maintain a strong footing in the EV market.
In this write-up, we will take a look at Ford's robust EV sales, explore the factors likely to drive Ford in the long term and assess whether now is a good time to invest in its shares.
Ford’s Impressive Q2 EV Deliveries
The company sold 23,957 EVs in the second quarter of 2024 in the United States, marking a 61% jump year over year. In terms of models, sales of Mustang Mach E, F-150 Lightning and E-Transit totaled 12,645, 7,902 and 3,410 units, up 46%, 77% and 96%, respectively. Notably, F-150 Lightning remains America’s top-selling electric truck and E-Transit is the nation’s best-selling electric van.
In the first half of 2024, Ford delivered more than 44,000 EVs in the country, nearly 72% up on a yearly basis. Ford's growth allowed it to maintain a lead over GM in the U.S. EV market. GM delivered 21,930 EVs in the second quarter, bringing its total to 38,355 for the first half of 2024.
Ford Model e Unit Poised for Long-Term Growth
Ford's EV segment is strategically positioned for robust growth through a multifaceted approach. Key strategies include scaling, leveraging digital capabilities for manufacturing efficiency and emphasizing vertical integration by insourcing critical components. The company aims to increase integration by nearly 50% in next-gen utility vehicles. Addressing the substantial cost of batteries, Ford is prioritizing energy efficiency and aims for one of the lowest-cost batteries assembled in the United States.
Ford Blue & Pro Units Also Spark Optimism
In the Ford Blue segment, the company has tremendous growth opportunities, particularly with highly coveted models such as the F-150, the Maverick, the Bronco, and, undoubtedly, the Mustang. A wave of new products, including the new F-150, the Ranger, a brand-new Explorer, and Expedition and Navigator will boost revenues.
As for the Ford Pro segment, strong order books, increasing demand signals and the successful launch of the all-new Super Duty sets the stage for a highly promising future. The segment is well-positioned to leverage these factors, driving significant growth. We expect adjusted EBIT from the segment to increase 24.3% year over year in 2024, driven by favorable mix and volume strength.
Price Performance & Valuation
With shares down around 15% year to date, it might be an opportune time to buy the dip on the back of strong fundamentals.
The company is trading cheap compared to the industry and carries a Value Score of A. F’s forward sales multiple sits at 0.31.
Image Source: Zacks Investment Research
Ford is Worth Buying Now
Although the Ford Model e unit is set to suffer losses this year, long-term prospects are promising enough. The Ford+ plan, emphasizing profit growth, e-mobility, and customer satisfaction, shows promise. High liquidity of more than $43 billion provides a solid foundation for investment in Ford+ priorities. To investors’ delight, the company targets distributions of 40-50% of FCF going forward, demonstrating its commitment to shareholder return. Amid all these tailwinds, the stock is witnessing northbound estimates for 2024 and 2025.
Image Source: Zacks Investment Research
Ford is trading above its 50-day and 200-day averages, indicating bullishness.
F Above 50 & 200 Day SMA
Image Source: Zacks Investment Research
Investors should consider parking their cash in Ford at its current price levels for solid long-term returns.
The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.