Al Root

Ford Motor stock fell early Wednesday after an analyst said to sell it. Although the auto maker has more manufacturing capacity in the U.S. than many of its peers, tariffs will still bite.

Bernstein's Daniel Roeska downgraded Ford stock to Sell from Hold. His price target went to $7 from $9.40.

Ford stock was down 0.1% in early trading at $8.69, while the S&P 500 and Dow Jones Industrial Average were up 0.8% and 0.4%, respectively.

"It is time to confront some hard truths, once more: vehicle tariffs have commenced, and parts tariffs are likely to follow within a month," wrote Roseka. "We extend our company analysis to Ford and find significant downside not priced by the market yet."

The move follows Roeska's Monday downgrade of General Motors stock to Sell from Hold, citing higher costs and a weakening consumer. GM just got "punched by the tariff man," Roeska wrote, adding that he wouldn't be surprised to see GM pause stock buybacks to conserve cash.

Ford is in the same boat, and Roeska believes Ford's dividend could come under pressure. He cut his 2025 earnings per share estimate to 86 cents from $1.46.

GM imports about 45% of the cars it sells in the U.S., mainly from the U.S. and Canada, according to Bloomberg. Ford only imports about 20%. Still, tariffs on imported parts will raise costs, which "significantly affects Ford."

There doesn't appear to be anywhere to hide from automotive tariffs. Even auto makers in relatively better positions will see big impacts, according to Wall Street.

Recent trading might mitigate the impact of the downgrade. Coming into Wednesday trading, Ford stock was down 14% since President Donald Trump's April 2 tariff announcements. GM and Stellantis shares are down 11% and 24%, respectively. Since the Nov. 5 presidential election, Ford, GM, and Stellantis shares are down 18%, 21%, and 38%, respectively.

With the Ford downgrade, 16% of analysts covering Ford stock have Sell ratings. That is about twice as high as the average Sell-rating ratio for stocks in the S&P 500.

About 24% of analysts covering Ford stock have Buy ratings. The average Buy-rating ratio for stocks in the S&P 500 is about 55%.

The average analyst price target for Ford stock is about $9.70, down from almost $12 since the election.

Write to Al Root at allen.root@dowjones.com

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April 09, 2025 10:01 ET (14:01 GMT)

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