Ford Motor Company (F) has failed to attract many Wall Street players for most of the past year. Now one firm has decided to reconsider its stance on it.
Jefferies upgraded Ford to buy from hold on Monday, July 27, and raised its price target to $17.50 from $14.50.
The call landed one day before Ford reported its second-quarter results, and Jefferies’ new target sat roughly 21% above where the stock traded early Monday, near $14.46.
The upgrade matters because Jefferies did not wait for the numbers to confirm the thesis. It bet that Ford’s second quarter would mark the low point for margins and volume before things improve.
For anyone holding Ford, or watching it, the question was simple: Did the setup justify buying before the print? The July 28 report gave the first answer.
What Jefferies changed on Ford and why the timing stands out
Analyst Philippe Houchois lifted Ford two notches in one move, from the sidelines to an outright buy, Investing.com reported.
He raised his 2026 adjusted EBIT forecast to $10.3 billion, near the top of Ford’s own guidance range of $8.5 billion to $10.5 billion.
More Auto Stocks:
- General Motors analyst sets new stock price target after earnings
- Ford set to challenge Tesla after big new deal with tech giant
- Volkswagen may cut 100,000 jobs in brutal reset
The bank made the same call on General Motors (GM) the same day, moving it to buy and lifting its target to $99 from $90, Benzinga reported.
What separated the two calls was confidence versus conviction. GM already delivered a strong quarter and raised guidance, so Jefferies was following the results.
However, with Ford, it stepped in ahead of them.
Why Jefferies thinks Ford’s second quarter is the low point
The core of the thesis rests on one word: normalization.
Jefferies projected second-quarter adjusted EBIT of about $2.5 billion, a 5.4% margin, even with wholesale volumes falling around 10%, according to CNBC.
The firm expected that quarter to mark the floor. A big reason is Novelis, an aluminum supplier whose New York plant feeds Ford’s F-150 line.
Two fires knocked that facility offline and affected F-150 output for months. Novelis restarted production, and Jefferies sees post-Novelis volume climbing back from here.
In plain terms, the trucks Ford could not build during the shortage are the ones it can start building again.
That pointed to a possible guidance raise, which Houchois flagged as likely, given healthy demand in the U.S. market.
What Ford’s second-quarter report actually delivered
Ford backed the thesis when it reported on July 28.
The company posted adjusted earnings of $0.42 per share, clearing the $0.36 consensus estimate, according to Yahoo Finance. Adjusted EBIT came in at $2.5 billion, up $400 million from a year earlier, at a 5.2% margin.
Related: Down 99%, popular EV stock is ripe bankruptcy candidate
Then came the part Houchois was counting on. Ford raised its full-year adjusted EBIT guidance to $10 billion to $11 billion, up from $8.5 billion to $10.5 billion, and lifted its adjusted free cash flow target to $6 billion to $7 billion from $5 billion to $6 billion.
Revenue told the softer side of the story, falling 4% year over year to $48.3 billion as the Novelis disruption and older model wind-downs weighed on volume.
The tailwinds Jefferies was counting on
The bull case was not built on hope alone. Several pieces were already in motion.
Ford’s first quarter beat expectations by a wide margin, with adjusted earnings of $0.66 per share against a $0.19 estimate and revenue of $43.3 billion, CNBC reported.
The company raised its full-year guidance on that report, helped by a $1.3 billion tariff refund benefit.
Other tailwinds include:
- Warranty costs are easing, which lifts margins without a single extra vehicle sold.
- Material costs are coming down, offsetting some of the drag from the EV unit.
- Free cash flow should grow as inventories rebuild and supplier compensation payments decline.
Ford Pro, the commercial and software arm, has been the quiet workhorse. Its paid subscriber base reached 879,000 in the first quarter, up 30% from a year earlier, according to Ford‘s earnings materials.
The number that could break the Ford bull case
Every clean thesis has a weak spot. For Ford, it is the electric vehicle division.
Model e lost $777 million in the first quarter, and management guided the unit to lose $4 billion to $4.5 billion for the full year, Investing.com showed.
Jefferies is betting that lower warranty and material costs will outweigh Ford’s EV losses, but that only works if the EV losses don’t grow faster than the savings. That math only holds if the EV losses don’t grow faster than the savings.
Ford already discontinued the electric F-150 Lightning and is pushing costs toward a cheaper Universal EV Platform, with a $30,000 midsize truck due in 2027.
That reset could pay off, and Ford’s new software deal with Apple strengthens the pitch.
The risk is the payoff sits years out, while the losses are here now.
How Ford stacks up against GM and the broader market
The stock is up about 15% year to date and has climbed roughly 31% over the past year, outrunning the S&P 500’s more modest gain over the same stretch. Shares closed at $15.28 on July 29 and gained about 8% over the prior five days as the earnings beat lifted sentiment.
Ford versus General Motors, at a glance
- Analyst mood: Wall Street still leans cautious on Ford, with 10 of 15 analysts at hold, while GM draws far more buy ratings.
- Recent results: Both automakers beat and raised guidance, with GM lifting its full-year outlook the prior week and Ford following on July 28.
- Income appeal: Ford’s roughly 4% dividend yield stays well above the market average, a draw GM cannot match.
For income investors, that yield is the real appeal. Ford’s free cash flow easily covers the dividend.
Ford also assembles most of its vehicles domestically, which gives it a structural edge over GM when tariffs hit import-heavy rivals.
What Ford investors should watch now that earnings have landed
Ford reported on July 28, and the print confirmed the core of the Jefferies thesis. A few lines still bear watching from here.
Your post-earnings checklist
- The guidance raise landed, so watch whether Ford holds the new $10 billion to $11 billion EBIT range through the second half.
- Check F-Series and truck production commentary for confirmation that Novelis volume keeps recovering.
- Read the Model e loss line closely, since a wider loss threatens the whole margin argument. The third-quarter loss narrowed, and investors will want that trend to continue.
- Track free cash flow, which Jefferies expects to keep improving as supplier payments fade.
A word of caution is in order, though. One firm’s upgrade is a data point, not a green light, and the majority of analysts covering Ford still sit at hold for a reason.
If you already own Ford, the setup rewards patience more than reaction. If you are considering a new position, the print gave you the proof the thesis needed, though the stock has already moved higher on it.
Jefferies set its target at $17.50 before the numbers. Ford has started backing it up, and the guidance line was the first place that showed.
