F
F
Hold 2026-03-23
Model
DCF
Price at Report
$11.52
Base IV
$10.77
Bear IV
$4.99
Bull IV
$17.35
Entry Zone: 5-10 · Sell Above: 15
Bore Family Office
Valuation Report — Ford Motor Company (F) • March 23, 2026
Unlevered DCF (FCFF @ WACC) • Discount Rate: 10.50% • Current Price: $11.52
Prepared by Lurch • Bore Family Office • Data: Finnhub, StockAnalysis.com, S&P Global Market Intelligence
🏢 Business Overview
Ford Motor Company is one of the world's largest automakers, designing and manufacturing cars, trucks, SUVs, and commercial vehicles under the Ford and Lincoln brands. The company restructured its reporting into three segments: Ford Pro (commercial vehicles), Ford Blue (ICE consumer vehicles), and Ford Model e (electric vehicles). Ford Pro is the crown jewel — high-margin commercial Super Duty trucks and Transit vans with subscription software growing rapidly. Ford Blue remains the cash engine but faces secular pressure from EVs. Ford Model e is losing ~$5B/yr as EV scale-up investments continue, creating a significant near-term drag.
FY2025 was severely impacted by ~$6-8B in warranty/recall charges primarily tied to quality issues on ICE vehicles, causing a $9.2B operating loss. Management is aggressively attacking quality costs; this is a one-time (albeit large) charge, not a structural collapse. Analysts expect EPS recovery to $1.56 in FY2026 as quality charges normalize.
| Business Segment | Revenue | % of Total | YoY Growth | Margin | Notes |
|---|---|---|---|---|---|
| Ford Pro (Commercial) | $65,000M | 35% | +12.0% | — | Super Duty, Transit; ~EBIT margin 15%+ |
| Ford Blue (ICE Consumer) | $96,000M | 51% | -2.0% | — | F-150, Explorer, Mustang; declining mix |
| Ford Model e (EV) | $12,000M | 6% | +20.0% | — | Mach-E, F-150 Lightning; ~$5B EBIT loss |
| Ford Credit & Other | $14,267M | 8% | +3.0% | — | Financial services; self-funded |
| Blended Growth Rate | — | 100% | +4.6% | — | Weighted avg across segments |
🔍 Quality Scorecard
| Metric | Value | Assessment |
|---|---|---|
| ROIC | 4.2% | <8% weak |
| FCF Margin | 3.6% | <5% weak |
| Revenue Trend | Growing 3yr | 3-year directional trend |
| FCF Margin Trend | Contracting | Directional margin trajectory |
| Analyst Revisions | Downward revisions | Last 90 days consensus direction |
⚠️ Elevated value trap risk — verify thesis before acting
📊 Financial Snapshot
| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue ($M) | $136,341 | $158,057 | $176,191 | $184,992 | $187,267 |
| EBITDA ($M) | $11,841 | $13,918 | $13,148 | $12,786 | $-1,335 |
| Operating Income ($M) | $4,523 | $6,276 | $5,458 | $5,219 | $-9,169 |
| Net Income ($M) | $17,937 | $-1,981 | $4,347 | $5,879 | $-8,182 |
| EPS (diluted) | $4.45 | $-0.49 | $1.08 | $1.46 | $-2.06 |
| Free Cash Flow ($M) | $9,560 | $-13 | $6,682 | $6,739 | $12,467 |
| Annual DPS | $0.100 | $0.500 | $0.600 | $0.600 | $0.600 |
| Total Debt ($M) | $138,092 | $138,969 | $149,231 | $158,522 | $163,336 |
| Rev YoY Growth | — | +15.9% | +11.5% | +5.0% | +1.2% |
| Gross Margin | 15.9% | 15.0% | 14.6% | 14.4% | 6.8% |
| EBITDA Margin | 8.7% | 8.8% | 7.5% | 6.9% | -0.7% |
| Operating Margin | 3.3% | 4.0% | 3.1% | 2.8% | -4.9% |
| Net Margin | 13.2% | -1.3% | 2.5% | 3.2% | -4.4% |
📈 DCF Scenarios
$5
🔴 Bear
$11
📊 Base
$17
🚀 Bull
$11.52
Current Price
$13
Analyst Avg PT
| Scenario | Stage 1 (Yrs 1–5) | Stage 2 (Yrs 6–10) | Terminal g | WACC | Intrinsic Value | vs Price |
|---|---|---|---|---|---|---|
| 🔴 Bear | -3.0% | 1.0% | 1.5% | 10.50% | $5 | ▼56.7% |
| 📊 Base | 4.0% | 3.5% | 2.0% | 10.50% | $11 | ▼6.5% |
| 🚀 Bull | 9.0% | 6.0% | 2.5% | 10.50% | $17 | ▲50.6% |
📋 Full 10-Year Projection Tables
Bear Scenario
Stage 1: -3.0% | Stage 2: 1.0% | Terminal: 1.5%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $5.04B | $4.56B | $4.56B |
| Year 2 | Stage 1 | $4.89B | $4.01B | $8.57B |
| Year 3 | Stage 1 | $4.75B | $3.52B | $12.09B |
| Year 4 | Stage 1 | $4.60B | $3.09B | $15.18B |
| Year 5 | Stage 1 | $4.47B | $2.71B | $17.89B |
| Year 6 | Stage 2 | $4.51B | $2.48B | $20.36B |
| Year 7 | Stage 2 | $4.56B | $2.26B | $22.63B |
| Year 8 | Stage 2 | $4.60B | $2.07B | $24.70B |
| Year 9 | Stage 2 | $4.65B | $1.89B | $26.59B |
| Year 10 | Stage 2 | $4.69B | $1.73B | $28.32B |
| Terminal | — | TV=$52.9B | PV(TV)=$19.5B (41% of EV) | EV=$47.8B |
| Intrinsic Value | — | — | EV $47.8B − Net Debt → Equity / Shares | $5 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (10.50%) to get its present value. After Year 10, FCF grows at the terminal rate (1.5%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $52.9B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $19.5B). Enterprise Value = PV of FCFs ($28.3B) + PV of TV ($19.5B) = $47.8B. Subtracting net debt gives equity value of $19.8B, divided by shares outstanding = $5 per share.
Base Scenario
Stage 1: 4.0% | Stage 2: 3.5% | Terminal: 2.0%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $5.41B | $4.89B | $4.89B |
| Year 2 | Stage 1 | $5.62B | $4.61B | $9.50B |
| Year 3 | Stage 1 | $5.85B | $4.34B | $13.84B |
| Year 4 | Stage 1 | $6.08B | $4.08B | $17.92B |
| Year 5 | Stage 1 | $6.33B | $3.84B | $21.76B |
| Year 6 | Stage 2 | $6.55B | $3.60B | $25.35B |
| Year 7 | Stage 2 | $6.78B | $3.37B | $28.72B |
| Year 8 | Stage 2 | $7.01B | $3.16B | $31.88B |
| Year 9 | Stage 2 | $7.26B | $2.96B | $34.83B |
| Year 10 | Stage 2 | $7.51B | $2.77B | $37.60B |
| Terminal | — | TV=$90.2B | PV(TV)=$33.2B (47% of EV) | EV=$70.8B |
| Intrinsic Value | — | — | EV $70.8B − Net Debt → Equity / Shares | $11 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (10.50%) to get its present value. After Year 10, FCF grows at the terminal rate (2.0%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $90.2B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $33.2B). Enterprise Value = PV of FCFs ($37.6B) + PV of TV ($33.2B) = $70.8B. Subtracting net debt gives equity value of $42.8B, divided by shares outstanding = $11 per share.
Bull Scenario
Stage 1: 9.0% | Stage 2: 6.0% | Terminal: 2.5%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $5.67B | $5.13B | $5.13B |
| Year 2 | Stage 1 | $6.18B | $5.06B | $10.19B |
| Year 3 | Stage 1 | $6.73B | $4.99B | $15.18B |
| Year 4 | Stage 1 | $7.34B | $4.92B | $20.10B |
| Year 5 | Stage 1 | $8.00B | $4.86B | $24.96B |
| Year 6 | Stage 2 | $8.48B | $4.66B | $29.62B |
| Year 7 | Stage 2 | $8.99B | $4.47B | $34.09B |
| Year 8 | Stage 2 | $9.53B | $4.29B | $38.37B |
| Year 9 | Stage 2 | $10.10B | $4.11B | $42.49B |
| Year 10 | Stage 2 | $10.71B | $3.94B | $46.43B |
| Terminal | — | TV=$137.2B | PV(TV)=$50.5B (52% of EV) | EV=$97.0B |
| Intrinsic Value | — | — | EV $97.0B − Net Debt → Equity / Shares | $17 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (10.50%) to get its present value. After Year 10, FCF grows at the terminal rate (2.5%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $137.2B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $50.5B). Enterprise Value = PV of FCFs ($46.4B) + PV of TV ($50.5B) = $97.0B. Subtracting net debt gives equity value of $69.0B, divided by shares outstanding = $17 per share.
🔲 Sensitivity Table
| WACC \ gT | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 8.5% | $15 | $16 | $18 | $19 | $21 |
| 9.0% | $14 | $15 | $16 | $17 | $18 |
| 9.5% | $13 | $13 | $14 | $15 | $16 |
| 10.0% | $11 | $12 | $13 | $13 | $14 |
| 10.5% | $10 | $11 | $11 | $12 | $13 |
| 11.0% | $9 | $10 | $10 | $11 | $11 |
| 11.5% | $8 | $9 | $9 | $10 | $10 |
| 12.0% | $8 | $8 | $8 | $9 | $9 |
| 12.5% | $7 | $7 | $8 | $8 | $8 |
Green = >10% above current price. Red = >10% below. Gold = within ±10%.
📉 Long-Term Price Trend Channel
Log-linear trend fitted to full price history. ±1.5σ bands. Green shaded zone = bottom 25% of historical range — historically attractive entry.
💰 Dividend / Distribution Analysis
| Metric | Value |
|---|---|
| Annual DPS | $0.600 |
| Current Yield | 5.21% |
| Consecutive Growth Years | 1 |
| 1-yr DPS CAGR | +0.0% |
| 3-yr DPS CAGR | +6.2% |
| 5-yr DPS CAGR | +43.0% |
| 10-yr DPS CAGR | — |
| Payout Ratio (DPS/EPS) | N/M (negative earnings) |
| FCF Payout Ratio | 4.8% |
| Sustainability Verdict | Watch |
Ford's base dividend of $0.60/yr is covered by Ford Pro and Blue cash flows, but FY2025's $8.2B net loss and quality charges highlight vulnerability. Ford suspended its supplemental dividend; the base $0.60/yr appears safe in 2026 assuming EPS recovery to $1.56+ (27% payout ratio — conservative). Verdict: Watch — base dividend likely safe; supplemental resumption depends on earnings recovery timeline.
🔮 Analyst Forecast Section
(a) EPS Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $4.45 | — | — | — | Actual |
| 2022 | $-0.49 | — | — | — | Actual |
| 2023 | $1.08 | — | — | — | Actual |
| 2024 | $1.46 | — | — | — | Actual |
| 2025 | $-2.06 | — | — | — | Actual |
| 2026 | $1.27 | $1.56 | $1.73 | 26 | Estimate |
| 2027 | $1.61 | $1.89 | $2.25 | 24 | Estimate |
(b) Revenue Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $136.3B | — | — | — | Actual |
| 2022 | $158.1B | — | — | — | Actual |
| 2023 | $176.2B | — | — | — | Actual |
| 2024 | $185.0B | — | — | — | Actual |
| 2025 | $187.3B | — | — | — | Actual |
| 2026 | $155.7B | $178.8B | $204.9B | 26 | Estimate |
| 2027 | $155.4B | $181.1B | $209.3B | 24 | Estimate |
(c) Individual Analyst Price Targets
Consensus: Avg $13.09 | Range $7–$16
| Analyst | Firm | Rating | PT | Upside |
|---|---|---|---|---|
| Ryan Brinkman | JP Morgan | Buy | $15 | +30.2% |
| Joseph Spak | UBS | Hold | $15 | +30.2% |
| Itay Michaeli | TD Cowen | Hold | $15 | +30.2% |
| Dan Levy | Barclays | Hold | $13 | +12.8% |
| Tom Narayan | RBC Capital | Hold | $12 | +4.2% |
(d) Earnings Surprise History
| Quarter | EPS Act vs Est | EPS Beat/Miss | Rev Act vs Est | Rev Beat/Miss | Guidance |
|---|---|---|---|---|---|
| Q4 2025 | $-0.39 vs $-0.25 | $-0.14 ❌ | $44.9B vs $43.5B | +$1.4B ✅ | FY2026 EBIT $7-8.5B guided |
| Q3 2025 | $0.10 vs $0.15 | $-0.05 ❌ | $46.2B vs $45.0B | +$1.2B ✅ | Quality charges elevated |
| Q2 2025 | $0.14 vs $0.20 | $-0.06 ❌ | $47.8B vs $47.0B | +$0.8B ✅ | Guidance maintained |
| Q1 2025 | $0.14 vs $0.22 | $-0.08 ❌ | $40.4B vs $41.0B | $-0.6B ❌ | Tariff uncertainty noted |
(e) Confidence Band Commentary
15 analysts cover F with consensus "Hold." The wide PT range ($7–$16) reflects genuine uncertainty about warranty resolution, EV loss trajectory, and tariff exposure. Key upside scenario anchors on Ford Pro delivering $3B+ EBIT independently by 2027. Key downside: additional warranty charges or tariff-driven volume declines. EPS estimates for 2026 carry high variance — the $1.27-$1.73 range is wide for a company this size.
💡 Investment Thesis
- Ford Pro is a gem at a discount: The commercial vehicle segment (Super Duty, Transit) generates 15%+ EBIT margins, pricing power, and growing software subscription revenue — yet it's buried inside Ford's discounted valuation. Standalone, Ford Pro would trade at 10-12x EBIT, implying ~$8-10/share in value.
- FY2025 warranty charges are non-recurring: The $6-8B in quality-related charges represent a painful but one-time reset. Management has restructured quality oversight and investor sentiment is bottomed.
- EV losses have a floor: Ford has been explicit about capping EV investment based on profitability — Model e losses are expected to narrow materially through 2026-2027.
- 6% base dividend yield at $11.50: Even with volatile supplemental dividends, the $0.60/yr base dividend is well-covered by Ford Pro cash flows.
⚖️ DCF Verdict: Hold — Ford Motor Company (F)
Current price: $11.52 | Analyst Avg PT: $13.09
$5
🔴 Bear
$11
📊 Base
$17
🚀 Bull
| Tier | Price | Action |
|---|---|---|
| Tier 1 — Starter | ≤$10 | Begin position |
| Tier 2 — Add | ≤$8 | Add on weakness |
| Tier 3 — Full | ≤$5 | Full allocation |
| Sell Alert | ≥$15 | Above fair value — consider trimming |
How tiers are set: Tier 1 = Base IV × 0.92 (8% discount to base case). Tier 2 = midpoint of Bear & Base IV (building on meaningful weakness). Tier 3 = Bear IV × 1.05 (just above worst-case — maximum margin of safety). Sell alert = Bull IV × 0.85 (15% discount to bull case — above fair value range).
Hold F at current prices (~$11.50). The Base DCF IV of ~$11-13 implies minimal upside at current prices — Ford is fairly valued, not cheap. Bull case ($16-17) requires warranty resolution AND EV loss narrowing AND Ford Pro maintaining margins simultaneously. This is a show-me story: wait for two consecutive clean quarters before accumulating. Becomes a Buy below $9 (Bear IV); avoid above $16 (above Bull IV).
🔧 Model Notes & Calibration
| Assumption | Rationale / Notes |
|---|---|
| FCF Base Normalization | Reported FCF $12.5B in FY2025 is heavily influenced by Ford Credit working capital swings. Using $5.8B = avg Ford automotive adj FCF (FY2023: $6.7B, FY2024: $6.7B) as the industrial FCF base — excludes Ford Credit. |
| Net Debt | Using $25B automotive-only net debt. Total consolidated net debt ~$125B is not relevant for equity valuation — Ford Credit debt is asset-matched and self-funded by the financial services business. |
| WACC | WACC = 9.5%: Ke = 4.3%+1.25×5.5% = 11.2%; Kd = 5.5%×0.78 = 4.3%; equity 75% / debt 25% → 9.5%. Ford is cyclical with above-market beta. |
| FY2025 Loss Context | FY2025 -$9.2B operating income driven by $6-8B in warranty/recall charges (largely non-cash reserves). Not a structural business collapse — Ford Pro alone generated $7B+ EBIT. |
| Tariff Risk | Potential 25%+ tariffs on Canadian/Mexican imports could cost Ford ~$1.5-2.5B/yr before mitigation. Bear scenario embeds this via FCF contraction and negative Stage 1 growth. |
Bore Family Office • Analysis generated by Lurch • Not investment advice.