Ford F-150 Franchise Worth More than Entire Company
Obviously, the F-150 is a valuable commodity. But you’ll never guess how valuable it really is!
It’s hard to put into words (or numbers) just how valuable the Ford F-150 truly is. The perennial best-selling vehicle on the planet is obviously Ford’s cash cow and an iconic piece of machinery. But we never really think of the truck in terms of how its value relates to the value of Ford as a company. Until now. Because some whip smart financial analysts have determined that the F-150 franchise is even more valuable than Ford itself.
“Ford’s out-of-favor status has brought valuation to where the F-150 [truck franchise] may be worth >150% of its EV [enterprise value],” Morgan Stanley analyst Adam Jonas wrote in a recent note to clients. According to CNBC, that means the F-150 truck portion of Ford’s business is worth around $16 per share. Meanwhile, Ford’s shares have been hovering a little over $10. How in the world is that even possible, you ask?
Well, as we all learned in economics 101, stuff is only worth what people will pay for it. And the stock market is all about perceived value. So Morgan Stanley’s insight basically means that Ford stock is incredibly undervalued. In other words, time to buy! Jonas also notes that investors are underestimating the effect that oil price recovery has on pickup truck demand, which could further boost Ford’s position in the near future.
All stock market mumbo jumbo aside, this is some fascinating information. While we already knew that the F-150 was a highly valuable component to Ford’s success, we didn’t know just how valuable it was. And the fact that one single nameplate is worth more than an entire automaker has to be unprecedented!
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