Should Income Investors Trust Ford’s Dividend Going Forward?

Ford Motor Company (NYSE:F) is one of the Best Dividend Leaders to Buy Now.

Ford Motor Company (NYSE:F) offers a highly attractive dividend, with a current yield of 5.6%, well above the S&P’s average, which is under 1.5%. The company pays a quarterly dividend of $0.15 per share, amounting to $0.60 annually, a level it has maintained since raising the payout from $0.10 in mid-2022.

A close-up of an auto assembly line, revealing the complexity of the manufacturing process.

In addition to its regular dividends, Ford Motor Company (NYSE:F) has issued several special dividend payments in recent years. These extra payouts have helped the company meet its goal of returning 40% to 50% of its adjusted free cash flow to shareholders annually.

Ford Motor Company (NYSE:F) kicked off the year with a sense of optimism, having wrapped up 2024 on a high note by posting record-breaking revenue. CEO Jim Farley commented in the fourth-quarter earnings release that the company was becoming a fundamentally stronger company, highlighting its wide-ranging product lineup and the strong market position of Ford Pro.

Due to new tariffs on key imports, Ford Motor Company (NYSE:F) suspended its first-quarter financial guidance, including its adjusted free cash flow outlook. That said, the company heads into this uncertain period with solid financial footing, closing the first quarter with $27 billion in cash and $45 billion in total liquidity. However, if tariffs significantly affect its earnings and cash flow, it might be prudent for the company to scale back its dividend. Many analysts covering Ford expect a potential dividend cut, possibly as early as the next quarter.

While we acknowledge the potential of F as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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