Ford Motor (F – Research Report), the Consumer Cyclical sector company, was revisited by a Wall Street analyst yesterday. Analyst Philippe Houchois from Jefferies maintained a Sell rating on the stock and has a $9.00 price target.
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Philippe Houchois has given his Sell rating due to a combination of factors impacting Ford Motor’s financial outlook. The company’s guidance for earnings before interest and taxes (EBIT) is within a broad range, with the upper limit falling short of current market expectations. This suggests potential challenges in achieving projected financial goals, especially given the flat to negative volume and mix expectations. Furthermore, there are risks associated with potential changes in auto policies that have not been accounted for in the current guidance.
Another concern is the company’s cash flow forecast, which includes negative timing effects related to warranty costs. While Ford’s Ford Blue division performed slightly better than anticipated, other divisions, including Model e and Ford Pro, did not meet expectations. Additionally, the company’s cost-cutting efforts, although aimed at achieving a $1 billion reduction, are primarily geared towards the latter half of the year, indicating short-term financial challenges. These factors contribute to a cautious outlook on the stock, leading to the Sell rating.
In another report released yesterday, Wells Fargo also maintained a Sell rating on the stock with a $8.00 price target.
F’s price has also changed slightly for the past six months – from $9.710 to $10.010, which is a 3.09% increase.