The auto maker still has a lot to prove to investors
Ford Motor Company (NYSE:F) is up 2.8% at $17.95 this afternoon, likely thanks to some broader-market tailwinds. The security has been testing a floor at the $17 level over the past week, after pulling back Jan. 13, record high of $25.87. The shares are still struggling with overhead pressure at their 100-day moving average, though, and have shed 28.5% month-to-date.
At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Ford stock sports a 10-day put/call volume ratio that sits higher than all readings from the last year. This means that while calls are outnumbering puts on an overall basis, the latter are have been getting picked up at a much quicker-than-usual clip.
Ford stock also presents an intriguing valuation. The security is trading at a forward price-earnings ratio of 8.38, and a price-sales ratio of 0.52. Nonetheless, the rest of the company’s fundamentals are relatively weak. The auto maker has $20.7 billion in cash, but holds $139.49 billion in total debt. Plus, F’s revenues fell 26%, while its net income decreased by nearly $5 billion between 2018 and 2020.
Nonetheless, Ford's revenues increased 7%, and its net income jumped up to $17.9 billion for 2021. This potentially signals a shift from the company's previously declining business model. Still, the auto maker's growth rate is simply not enough to warrant the risks it currently offers.