Ford shares rebound on Monday, Goldman Sachs upgrades stock to “Buy”, revises up price target

Fords stock could generate a 40% return for investors during the year ahead, since the US auto manufacturer seeks to reorganize its business and to improve its bottom line, according to Goldman Sachs.

Ford shares closed higher for the third time in the past ten trading sessions in New York on Monday. The stock went up 3.34% ($0.30) to $9.28, after touching an intraday high at $9.59, or a price level not seen since September 24th ($9.85).

Shares of Ford Motor Company have retreated 25.70% so far in 2018 compared with a 1.21% drop for the benchmark index, S&P 500 (SPX).

In 2017, Ford’s stock went up 2.97%, thus, it again underperformed the S&P 500, which registered a 19.42% return.

The Wall Street bank raised its rating on Ford from “Neutral” to “Buy” and also revised up its price target on the stock from $9 to $12. According to the bank, the upward price revision in combination with a “sustainable”, 6.7% dividend yield brings the expected return on the stock to just over 40%.

“While we still expect a downward earnings trajectory into 2019 (North America profit under-pressure), we believe next year will represent trough earnings and the combination of a refreshed product cadence globally as well as cost improvements from strategic initiatives will begin to take hold,” Goldman Sachs analyst David Tamberrino wrote in a note to clients, cited by CNBC.

According to CNN Money, the 21 analysts, offering 12-month forecasts regarding Ford Motor Company’s stock price, have a median target of $10.00, with a high estimate of $13.00 and a low estimate of $7.00. The median estimate represents a 7.76% upside compared to the closing price of $9.28 on October 29th.

The same media also reported that 18 out of 23 surveyed investment analysts had rated Ford Motor Company’s stock as “Hold”, while 3 – as “Buy”. On the other hand, 1 analyst had recommended selling the stock.

Weekly Pivot Levels

By using the traditional method of calculation, the weekly levels of importance for Ford Motor Company (F) are presented as follows:

Central Pivot Point – $8.74
R1 – $9.30
R2 – $9.63
R3 – $10.19
R4 – $10.76

S1 – $8.41
S2 – $7.85
S3 – $7.52
S4 – $7.20