Bank of America (BofA) reiterated on Tuesday a Buy rating on Ford‘s stock, after the Detroit automaker announced on Monday that it will invest “approximately $5 billion” in a new EV platform.
The company hosted the “our Next Model T Moment” event — which referred to a new fully electric pick-up truck, to be launched in 2027 with a target starting price of $30,000.
In a note to clients obtained by PriceTarget, BofA analyst John Murphy highlighted that “Ford did its homework and may have a competitive product for the next wave of electrification.”
The new Model T “should bring to market significant changes in vehicle manufacturing,” Murphy noted, as Ford will invest on a $2 billion upgrade to its Louisville facility to accommodate production of the vehicle.
“At a first look, we think these results are promising and we are encouraged that Ford is learning from EV manufacturing leaders to come to market with a compelling balue proposition,” Murphy wrote.
In the first quarter, the company’s EV unit ‘Model e’ reported a EBIT loss of $849 million, with the company saying it remained “focused on improving gross margins and exercising a disciplined approach to investments in battery facilities and next-generation products.”
In the second quarter, however, the losses extended to $1.3 billion. The value was $179 million higher than the same quarter a year ago.
Murphy said “Ford‘s approach looks at the future rather than the immediate term,” even considering that “EVs may have hit the brakes in the US” — likely referring to the termination of the $7,500 EV consumer credit by September 30.
The analyst compares the automaker to other players, like Tesla, which are “positioning to offer affordable EVs to the US market and Ford doesn’t want to lag.”
The Elon Musk-led company has reaffirmed on its quarterly shareholder deck that its more affordable model has volume production planned for the second half of 2025.
“Ford has a global footprint, which makes it imperative to have a competitive EV lineup ,” Murphy noted, adding that “other geographies are still moving toward electrification.”
The automaker sold 189,313 vehicles in the US last month, up from the 173,223 units reported a year ago.
When it comes to fully electric vehicles, sales slightly dipped by 0.2% year over year, but nearly 70% higher from June.
According to the analyst, “the bottom line is that we see the event as positive for the company and its competitiveness both domestically and internationally.”
BofA has reiterated a $14 price target on Ford, which implies an upside potential of 25.7%, based on Monday’s close at $11.14. The stock grew 12.5% year to date and nearly 10% in the past twelve months.
On the other hand, Bernstein maintained a $8.30 price target on the Detroit automaker, with analyst Daniel Roeska telling “investors to focus on deteriorating earnings in the near term.”
The price target implies a downside of 25.5%. The brokerage firm also reiterated its Underperform rating on Ford.
“While management’s unveiling of the ‘Ford Universal EV Platform’ signals a clearer long-term direction, near-term earnings are set to weaken under the twin pressures of tariffs and affordability-driven demand softness,” Roeska stated.
On Monday, Jefferies analyst Philippe Houchois raised the firm’s price target on Ford shares to $9 from $8 while reiterating an ‘Underperform’ rating on the stock.
