Ford shares gain the most in 3 1/2 weeks on Tuesday, auto maker upgraded to “Overweight” at Morgan Stanley, price target also raised

August 7, 2019 9:38 am

Morgan Stanley on Tuesday upgraded Ford Motor Company (F) from “Equal Weight” to “Overweight”, as the firm highlighted a “significant increase” in estimates for the auto maker’s earnings over the upcoming three years and also stressed on Ford’s “restructuring actions”, “strategic actions” and “product mix enhancement.”

Morgan Stanley also raised its 12-month price target on the stock from $10.00 to $12.00.

Ford shares closed higher for the fifth time in the past fifteen trading sessions in New York on Tuesday. It has also been the sharpest daily surge since July 12th. The stock went up 2.71% ($0.25) to $9.48, after touching an intraday high at $9.51, or a price level not seen since August 1st ($9.59).

Shares of Ford Motor Company have risen 23.92% so far in 2019 compared with a 14.96% gain for the benchmark index, S&P 500 (SPX).

In 2018, Ford Motor Co’s stock went down 38.75%, thus, it underperformed the S&P 500, which registered a 6.24% loss.

According to Morgan Stanley’s analyst Adam Jonas, the recent dip in Ford’s share price represents a “buying opportunity,” since it can be considered as a “reset of [fiscal year 2019] expectations.”

“Our previous concerns over Ford’s ability to maintain its dividend payment have largely subsided,” the analyst also wrote in a note to investors, cited by CNBC.

Analyst stock price forecast and recommendation

According to CNN Money, the 16 analysts, offering 12-month forecasts regarding Ford Motor Company’s stock price, have a median target of $10.25, with a high estimate of $13.00 and a low estimate of $8.20. The median estimate represents an 8.12% upside compared to the closing price of $9.48 on August 6th.

The same media also reported that at least 12 out of 20 surveyed investment analysts had rated Ford Motor Company’s stock as “Hold”, while 6 – as “Buy”. On the other hand, 1 analyst had recommended selling the stock.

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