Daily Stock Pick: Ford Motor Company

This week, I'm seeking the second robust dividend-paying stock from the consumer cyclical business sector for my Ivy portfolio. 

That cyclicals sector includes twenty-eight industries ranging from Advertising Agencies to Apparel, Autos, Broadcasting, Department Stores, Gambling, Leisure, Lodging, Packaging, Personal Services, Shoes, Restaurants, Rubber, Plastics, Textiles, and all such consumer aimed enterprises.

Today I'm reviewing a large-cap auto manufacturer, named Ford Motor Company. Its trading ticker symbol is F.

Ford Motor Co manufactures, markets, and services Ford cars, trucks, sport utility vehicles, electronic vehicles, and Lincoln luxury vehicles. It also provides financial services through Ford Motor Credit Company.

Its Automotive segment sells Ford and Lincoln vehicles, service parts, and accessories through distributors and dealers, as well as through dealerships to fleet customers, daily rental car companies, and governments. 

The company's Financial Services segment offers various automotive financing products to and through automotive dealers. Its financing products comprise retail installment sale contracts for new and used vehicles; and direct financing leases for new vehicles to retail and commercial customers.

The company has a strategic collaboration with Panasonic Corporation of North America and Qualcomm Technologies. 

Ford Motor Company was founded in 1903 and is based in Dearborn, Michigan.

I use three key data points to gauge the value of any dividend equity or fund like Ford Motor Company: 

(1) Price

(2) Dividends

(3) Returns

Besides those three, four more keys will finally unlock an equity or fund in which to invest.

But those first three primary keys, best tell whether a company has made, is making, and will make money. 

F Price

Ford's price per share was $9.37 at yesterday's market close. A year ago its price was $12.11 for a price decrease of $2.74 per share for the year, for a  22.6% tumble. 

Assuming Ford's price will trade in the range of $8 to $14  next year, Ford's recent $9.37 price could improve by $1.00 and grow to $10.37 by late-November, 2019. 

F Dividends

Ford's most recent quarterly dividend was $0.15 declared October 11th and payable next week, December 3rd. 

That $0.15 quarterly stipend equates to an annual amount of $0.60 yielding 6.4% at yesterday's closing $9.37 price.

Gains For F?

Adding the $0.60 annual dividend to my estimated $1.00 annual price upside for Ford Motor Company adds up to a $1.20 potential gross annual per share gain, which will be reduced by costs to trade the shares.  

For under $1,000.00 invested today at the $9.37 recent we can buy 100 F shares. 

A $10 broker fee paid half at purchase and half at sale costs us $0.10 per share

Subtracting that $0.10 brokerage cost from the estimated $1.60 gross annual gain leaves a net gain of $1.50 X 100 shares 

= $150.00

for a 16% net gain on a $937.00 investment.

Therefore, Ford Motor Company, whose trading ticker symbol is F, now shows a possible 16% net gain including a 6.4% dividend yield. 

Twenty-one brokers cover this stock:

Two say "buy"  Ford

Three say Ford will "outperform" peers.

Fifteen say "hold' Ford stock.

One say "sell" Ford.

Their consensus number adds up to 2.8 of  "hold" like the majority says.

As for price the twenty-one wall street wizards think the stock will rise just $0.71 in the coming year. 

Therefore, you may look at these Ford Motor Company, whose trading ticker symbol is F, has made money, is making money, and could net a 10 to 16% net annual gain including a 6.4% dividend yield. It could be more, it could be less. 

The above speculation is based on past year performance. The actual results remain to be seen to determine if Ford Motor Company is worth your time and money.