Is Ford a blue-chip stock?
Ford (NYSE:F) is another blue-chip stock to buy that has remained subdued in the last 12 months. At a forward price-earnings ratio of 6.7, the stock looks deeply undervalued. Backed by impressive sales numbers, I believe F stock will likely surge higher in the coming quarters.
Nonetheless, Ford is in a favorable position today. With $2 billion in cost reductions identified for this year, the business expects to generate $10 billion to $12 billion of adjusted operating income in 2024. At the midpoint, that would be higher than the $10.4 billion registered last year.
| Company | Market Cap (Rs. cr) | ROA(%) |
|---|---|---|
| Wipro | 249,400 crores | 7.47% |
| Bajaj Auto | 215,100 crores | 14.87% |
| Adani Ports & Special Economic Zone | 247,700 crores | 6.03% |
| ITC Limited | 568,600 crores | 18.20% |
Blue chip companies have solid business models and impressive track records of returns for investors. These returns often include regular and growing dividend payments. The blue chip stocks' attractive risk-reward profiles make them among the most popular for conservative investors.
| Stocks | Sector | 12-month dividend yield |
|---|---|---|
| Exxon Mobil Corp. (XOM) | Energy | 3.8% |
| Walgreens Boots Alliance Inc. (WBA) | Health care | 7.6% |
| PepsiCo Inc. (PEP) | Consumer defensive | 3% |
| McDonald's Corp. (MCD) | Consumer cyclical | 2.1% |
In conclusion, while Ford has the potential to reach $100 per share, it faces significant challenges that could hinder its stock price growth. Ford Motor Company's stock reaching $100 seems a daunting task, given it would require a 7.3x increase from its current price.
Key Points. Ford posted a double-digit sales increase last year. Thanks to cost cuts, management expects higher adjusted operating income in 2024. Intense competition, huge capital expenditures, and low growth are reasons to avoid the stock.
Advantages. Low Risk: As industry leaders with reliable cash flows and long histories of paying their debts, blue chip companies are considered to be low risk.
During economic slowdowns, investors turn to blue chip stocks to protect their investments.
Blue chips are considered safe investments due to their longstanding financial stability.
Which stock will boom in 2024?
| S.No. | Company | Industry/Sector |
|---|---|---|
| 1. | Tata Consultancy Services Ltd | IT - Software |
| 2. | Infosys Ltd | IT - Software |
| 3. | Hindustan Unilever Ltd | FMCG |
| 4. | Reliance Industries Ltd | Refineries |
Ford (NYSE:F) is another blue-chip stock to buy that has remained subdued in the last 12 months.
| Stock | 2024 return through March 31 |
|---|---|
| MicroStrategy Inc. (MSTR) | 169.9% |
| SoundHound AI Inc. (SOUN) | 177.8% |
| Vera Therapeutics Inc. (VERA) | 180.4% |
| Avidity Biosciences Inc. (RNA) | 182% |
Stanley Black & Decker, Inc.
Overall, it has consistently paid dividends without fail for the past 147 years and also holds a 56-year track record of consistent dividend growth, which makes SWK one of the best dividend stocks on our list. The stock's dividend yield on April 6 came in at 3.40%.
- ARMOUR Residential REIT – 20.7%
- Orchid Island Capital – 17.8%
- AGNC Investment – 14.8%
- Oxford Square Capital – 13.7%
- Ellington Residential Mortgage REIT – 13.2%
- SLR Investment – 11.5%
- PennantPark Floating Rate Capital – 10%
- Main Street Capital – 7%
| Stock | Dividend yield |
|---|---|
| Coca-Cola Co. (KO) | 3.3% |
| Johnson & Johnson (JNJ) | 3.4% |
| Prologis Inc. (PLD) | 3.7% |
| Realty Income Corp. (O) | 5.9% |
Buying a great company with a robust outlook at a cheap price is always a good investment, so let's also take a look at the company's future expectations. Ford Motor's earnings over the next few years are expected to increase by 69%, indicating a highly optimistic future ahead.
Stock Price Forecast
The 13 analysts with 12-month price forecasts for Ford Motor Company stock have an average target of 13.95, with a low estimate of 10 and a high estimate of 20. The average target predicts an increase of 15.48% from the current stock price of 12.08.
Based on short-term price targets offered by 19 analysts, the average price target for Ford Motor Company comes to $13.75. The forecasts range from a low of $10.00 to a high of $21.00. The average price target represents an increase of 9.04% from the last closing price of $12.61.
According to our current F stock forecast, the value of Ford Motor shares will drop by -7.12% and reach $ 11.23 per share by April 22, 2024. Per our technical indicators, the current sentiment is Bearish while the Fear & Greed Index is showing 39 (Fear).
What is the Ford dividend for 2024?
Ford Motor Co (NYSE:F) recently announced a dividend of $0.15 per share, payable on 2024-03-01, with the ex-dividend date set for 2024-02-15. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates.
With its 4-star rating, we believe Ford's stock is undervalued compared with our long-term fair value estimate. We are maintaining our fair value estimate at $19 per share.
If certain shares have consistently underperformed with little hope of recovery, it may be wise to sell them. Selling under-performers can free up capital that could be better invested elsewhere and allow you to use capital losses to offset gains for tax purposes.
Cons of Blue chip stocks
Lower Growth Potential: Despite the fact that blue chip stocks often have solid profitability, their rate of growth is typically slower than that of other equities because of the markets they participate in.
| Stock (ticker) | Market Capitalization |
|---|---|
| AbbVie Inc. (ABBV) | $320 billion |
| Coca-Cola Co. (KO) | $256 billion |
| Nike Inc. (NKE) | $138 billion |
| Goldman Sachs Group Inc (GS) | $133 billion |
