Ford’s Estimates Boosted at Morgan Stanley; Domestic Sales Looking Better (F)

Auto maker Ford Motor Company (F) on Tuesday caught some positive commentary from analysts at Morgan Stanley.

The firm maintained its “Overweight” rating and $18 price target on F, which suggests a massive 44% upside to the stock’s Monday closing price of $12.48. Morgan Stanley also raised its earnings estimates for the company through 2013, citing higher domestic sales.

A Morgan Stanley analyst commented, “Ford’s full year guidance of 2012 total company pretax profit ‘about equal’ with 2011 levels at a 30 or 31% tax rate implies group EPS in the neighborhood of $1.55. Our fcst of a 6% drop in group pretax to $8.2bn puts us at $1.45. Our ests are based on a $600m drop in Ford Credit pretax which may not be as low as the company is implying with its headwinds on residuals and credit losses.”

Ford shares posted modest gains in premarket trading Tuesday.

The Bottom Line
Shares of Ford Motor Company (F) have a 1.60% dividend yield, based on last night’s closing stock price of $10-$11 price area. If the shares can firm up, we see overhead resistance around the $13-$14 price levels.

Ford Motor Company (F) is not recommended at this time, holding a DARS™ Rating of 3.1 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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