Ford Stock Price Trades in a Single Digit, Upside Is Limited

Ford Motor

Ford (NYSE: F) stock price continues to trade in a single-digit after experiencing some bounces during the mid of this year. The stock price is currently trading slightly above from 52-weeks low of $7.5. The stock traded in a narrow range of $10 to $7.5 over the last 52-weeks.

The latest selloff in Ford share price is supported by traders’ concerns over lower sales and increasing market competition. Its U.S. sales declined sharply in the third quarter – which is the largest revenue generation area.

F Ford Motor Company daily Stock Chart

U.S. Sales Impacts Ford Stock Price

The company has been experiencing pressure on its revenue growth potential. Indeed, its revenue from the largest market continues to decline year over year. This is evident from a mid-single-digit decline in U.S. sales during the third quarter.

Its Q3 U.S. sales dropped 4.9% from the previous year period. The decline is driven by a 10.5% drop in SUV sales and a 29.5% decline in car sales. On the positive side, its Q3 Truck sales increased 8.8% from the past year period.

The company is currently focusing on truck and SUV’s while it is reducing concentration on cars. Consequently, Ford’s truck and SUV mix rose to 87%, up from 82% in the year-ago period.

The CEO said, “As planned, this year is a transitional one for Ford as we move from our sedan lineup to an all-new winning portfolio of trucks and SUVs. Our truck, van, and commercial business continued to be strong in the third quarter, with record van sales and continued F-Series sales leadership.

Lower Analysts Confidence Adds to Bears Sentiments

Several analysts have downgraded Ford stock price ratings in the last couple of months.

Buckingham Research lowered its price target. This is because the firm expects lower than expected earnings in the third quarter. The firm says that they are seeing weakness in some markets.

Moody’s has also cut Ford ratings to junk status. Analysts are suggesting investors keep a close eye on the Q3 earnings report before initiating a position.

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siraj sarwar

Based in Saudi Arabia, Siraj has a strong understanding of and passion for accounting and finance. He has worked for international clients for many years on several projects related to the stock market, equity research and other business, accounting and finance related projects. Siraj is a published financial analyst on the world's leading websites including SeekingAlpha, TheStreet, MSN, and others.
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