Ford Motor Company (NYSE:F)’s shares are up by 24% over the past year and by 5%. year-to-date. The shares gained almost 8% between July 23rd and July 29th. On the 28th, Ford Motor Company (NYSE:F) reported its second-quarter earnings. The results saw the firm post $44.89 billion in revenue and $0.42 in earnings per share to miss analyst revenue estimates of $45.86 billion and beat the earnings estimates of $0.35. As part of the earnings, Ford Motor Company (NYSE:F) also increased its full-year operating income guidance to $10 billion and $11 billion from an earlier $8.5 billion to $10.5 billion and its free cash flow guidance to $6 billion to $7 billion from the earlier $5 billion to $6 billion. It outlined that the cash flow would benefit from a tariff reimbursement. No wonder Cramer thought that Ford Motor Company (NYSE:F)’s results were the best of the bunch:
“All in all a positive night. I liked Ford best!!!!”
The debate surrounding Ford Motor Company (NYSE:F)’s stock centers on whether the firm’s ongoing turnaround efforts will enable it to shake off the drag of being a legacy automaker. With the Trump administration having fully settled in, Ford Motor Company (NYSE:F) has had to incur hefty electric vehicle write downs. However, Cramer did paint the shift in a slightly positive light last year when he remarked that the firm could play a role in the hybrid vehicle industry.
A key point of debate for Ford Motor Company (NYSE:F) surrounds the firm’s cost control efforts. Through these, the firm aims to save up to $2 billion in costs. However, the bears are unimpressed by the plans as they point towards recurring costs such as those stemming from warranty issues. They also outline that while Ford Motor Company (NYSE:F) plans to reshape its business to also provide energy storage for data centers, the energy play is still in the early stages. They add that even if it works, the tailwinds might be insufficient to offset headwinds from the EV write downs and manufacturing problems. To sum it up, the debate is divided on whether Ford Motor Company (NYSE:F)’s latest initiatives, such as cost control and data center energy plays, can help it overcome longstanding issues such as warranty costs and manufacturing issues.
Just like Ford Motor Company (NYSE:F), the debate is the same for its peer firm, General Motors Co (NYSE:GM). Cramer has discussed the firm several times over the past couple of months, and most of his comments have praised CEO Mary Barra. Like Ford, General Motors Co (NYSE:GM)’s bears also worry that the automotive industry might be at its cyclical peak. Some of the factors that they point towards include shaky consumer credit, dealer inventory levels and the potential of discounts to stress margins. However, the bulls point towards strong financials, such as a Q2 revenue and earnings beat and full year operating income guidance hike to $14 billion and $16 billion from an earlier $13.5 billion to $15.5 billion as evidence of robust financial performance.
Looking at the hedge fund sentiment, 52 out of the 1,041 hedge funds part of Insider Monkey’s Q4 2025 database had held a stake on Ford Motor Company (NYSE:F). This figure dropped to 50 out of 1,022 funds in Q1 2026. On the other hand, sentiment in General Motors was more robust as 81 and 77 funds had owned a stake in Q4 and Q1, respectively. The difference in the sentiment for the two is also visible in the P/E multiple as while Ford Motor Company (NYSE:F) trades at a forward P/E ratio of 7.96, GM’s ratio is 6.71. 2.8% of the latter’s float is also short, while the percentage is negligible for Ford.
While Insider Monkey acknowledges the risk and potential of F as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than F that has 100x upside potential, check out our report about the cheapest AI stock.
READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.
Disclosure: None.
