A New Product Shows Ford Is Finally Taking Electric Seriously
Ford just announced the release of its Lightning all-electric F150, due 2022. Available at essentially the same price point ($39,974) that Tesla has advertised for its Cybertruck, due late 2021. A Ford rep dropped this little bomb on Tesla's triangle-shaped Cybertruck in a media interview: “Our customers told us they want something modern and advanced, but did not want their truck to look like a doorstop or a spaceship.” Boom.
The new F150 does look a lot better than the doorstop, and it has some cool features. Instead of an engine under the hood, it has a spacious storage space there, which they're calling a "frunk." The frunk has a 400-pound capacity and four 110-volt power outlets and two USB charging outlets.
There's a total of 11 outlets on the truck. Whereas Tesla will void your warranty if you try to power your home with your car battery, the F150 outlets are specifically designed to serve as backup power (9.6 kW and 3 days worth of power) for your home. If your F150 is plugged in and an outage occurs, your F150 will automatically switch to providing power to your home. Wow. You do have to buy an extra 80-amp wall box and home power system to make that work, though. The wall box also increases range and charging speed.
For charging away from home, Ford has a North American charging network with more than 63,000 plugs. These will charge an extended range F150 from 15 to 80 percent in about 41 minutes. The standard-range truck has a range of 230 miles, while the extended-range truck can go 300 miles. The F150 offers hands-free highway driving to compete with Tesla's autonomous driving features.
The Valuation on Ford is Insane
Most of the "cheap" companies out there are trading at a price to free cash flow ratio around 7 or 8. Ford is trading at 2 P/FCF, making it cheaper on that basis than just about any other company I follow. Forward P/E is around 12, with P/S at 0.38 and P/B at 1.46. Get this: according to Fidelity, the 5-year PEG ratio for Ford is 0.25. 0.25!!!! Ford has also been crushing analyst estimates on recent earnings reports.
Sentiment is Strong
Ford has an 8.8/10 analyst score and an 85/100 fundamentals score from S&P Global. Ford's ESG score leaves a little something to be desired, but maybe that will improve as the company electrifies. Put/call ratio is bullish at 0.66. Technicals look good. On the monthly chart, moving averages are pointing upward, and price is sitting right atop the 200-month EMA. Similar story on the daily. We popped through a resistance line the last few days. I am buying any dip to the 20- or 50-day EMA.
Weekly recently made a 50-200 bullish moving average cross:
With news, valuation, sentiment, and technicals all lined up, I bought both shares and a couple long-dated 2023 calls at the $12 strike, because YOLO.
Комментарий
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Ford basically hit my $16.00 target today. Possibly there will be a continuation to $17.00 before it regresses to the mean, but I took profit on my calls here.
Very old post and very belated comment it sure is, but do you have any idea why Ford with 9-figure revenue trades at $12 and yet Spotify with 7-figure revenue trades at $1500? For comparison TSLA at 1/5 the size of operation of Ford is trading above $700 at this point. Never in the history of Ford has it traded above $33. I know about P/E P/B ratio and they can be irrational longer than people remain solvent etc. But still, how could this remain stable? Am I missing something?
1) Tesla and Spotify are AI/machine learning plays, which is really sexy tech.
2) Tesla and Spotify have trailing five-year compound annual revenue growth rates of 30-50%, while Ford's was -3%. Ford suspended its dividend a couple years ago, so the "income investors" who made up their investor base jumped ship. Ford is reinvesting that dividend money into growth, but it has yet to prove itself to the "growth investors" it hopes to attract.
3) Autos are a tough business, and at nine-figure revenue, Ford has a tougher row to hoe to grow its market share than Tesla does. It's easier to have high-percentage growth from a smaller base.
4) Ford appears on paper to have a lot of debt on the books (though actually that's a bit of an illusion, because they have a captive financing arm that borrows money to lend it to consumers so they can buy Ford's cars).
Popovich
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@ChristopherCarrollSmith, I must say I never expect a complete answer such as yours. I am getting the hang of this but I must say, I have just become a fan, a genuine fan. The wannabe authors foisting superstitions like 4h pinbar off imaginary support or resistance don't care to say anything else that has nothing to do with earning followers. You sir are a breath of fresh air.
ChristopherCarrollSmith
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@Popovich, I'm blushing, haha. Thanks. I wish this investing thing were as easy as watching the 4-hour pinbar bounce off a line or whatever, but that just doesn't get the job done. The institutions have small armies of analysts working full-time on this stuff, so if we retail investors want to have any chance of competing, we've got to put in the effort, build the tools, and work together.
malanoskirower
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Im liking my jan 2022. I will probably sell at mid 16 and buy back in later
@ChristopherCarrollSmith, 16.33 in the aftermarket. Tomorrow will be stressful to decide if I hold over weekend or not. Wish you luck playing ford. Do you have any thoughts on the impact of maverick specs reveal next tuesday, I know it will be small and offer a hybrid version.
ChristopherCarrollSmith
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@malanoskirower, probably will be a positive for the stock, but I don't know that it will significantly move the needle if the stock hits 17 before then. That 17 level is going to be strong resistance and there will likely be some snapback from there.
FierceDragon
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argh. my USD wasnt ready.
Is it too late to get in now with pre-market @ $14+?
ChristopherCarrollSmith
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@FierceDragon, I wouldn't. Bond yields are up today, which will drag the whole market down.