Ford Motor Company’s shares plummeted over 3% before the opening bell on Monday, following a downgrade by Jefferies from “hold” to “underperform”. The brokerage cited concerns over inventory build-up, strategic uncertainty in Europe, and a widening gap between warranty provisions and cash outflows. Jefferies analysts reduced its price target for Ford to $9, citing de-stocking as an overhang on the US market.
The downgraded shares reflect worries about Ford’s ability to address a cumulative $8.5 billion gap since 2020, which could constrain cash available for shareholders. However, Jefferies retained a “hold” rating on General Motors (GM), with a price target of $52, citing potential benefits from GM’s near-term earnings and continued cash transfers to shareholders.
The US market remains a protected oasis, with stable profits concentrated among major players such as GM, Ford, Stellantis, and Toyota Motor. Nevertheless, slowing cash generation could impact industry momentum as dealer stock rebuilding ends.
Source: https://finance.yahoo.com/news/ford-down-jefferies-downgrade-stock-135059414.html