Today I made Ford (F) my fifth pick for a falling market in my Special Report: Five Picks and Five Hedges for a Falling Market on my JubakAM.com subscription site. Some of the logic of that pick is laid in n more detail in the Special Report. With momentum stocks showing signs of flagging, I think adding more value stocks or special situations with very specific growth “events” set to trigger a cascade of good news is indicated. In the case of Ford the company is building good momentum on its introduction of popular electric vehicles such as an electric Mustang and an electric F150 pickup truck. The press on these vehicles has been positive and the early sales on the Mustang have been impressive. The F150 is, in most years, the best-selling pickup in the world and I think excitement of an electric pickup–and the likely glowing press about how an electric F150 signals that electric vehicles have hit the mainstream (whether true or not)–will give buzz to the stock. (And, just in case you haven’t noticed from the examples of GameStop (GME) and AMC Entertainment (AMC) this is a market that rewards “buzz.”) There’s also already talk about Ford moving to restore the dividend on its shares. That’s another plus. Morningstar projects that the company will see increased EBIT margins in 2023-2025. And the end of the current semiconductor shortage–whenever that may come–will enable auto makers to return to regular production.
I will be adding shares of Ford to my Jubak Picks Portfolio as the fifth of my “5 Picks for a Falling Market” on June 9. I’m setting a one year target price of $21 a share. Ford shares closed at $15.63 on June 8.