Everything You Need to Know About Ford Stock Dividend
Ford Stock Dividend
Dividend stocks are companies that pay dividends annually, quarterly and some even paying monthly ford dividend stock. and divined yield represents by the amount of money that companies pay shareholders for having a share of its stock dividend.
And today’s special guest is Ford Motor Company and know more at 711 finance.
For the investors who want to use their ford’s stock dividend to generate sustainable cash flow, there are two one concerns about the ford motor company :
- The performance of the company including ford stock dividend history.
- Whether the management is inserted in paying shareholders with divined or not.
First of all, we will give a quick general idea about the company: ford is a manufacturing company specializes in vehicles, the company has been in the business since 1903 since then they had a long heritage of progress.
Now Ford has operations across North America and in over 125 countries across the world.
This article will provide you with all you should know about ford’s stock dividend, means we will go through the company’s performance for the past ten years, including
1-Ford’s business overview
2-Ford’s growth and dividend analysis
this section will talk about the growth prospect, also about dividend’s analysis including the following:
- stock dividend price
- dividend payouts
- dividend yield
- Risks and benefits
1-Ford’s business history overview
Ford motor’s Co. company focuses on manufacture and distribution meaning selling automobiles, It was founded in 1903 by Henry Ford and incorporated, by 1959 Henry owned all the company stock and on January 18, 1956, the company started selling dividend stocks to the public for $64,50 per share.
Nerd, not N Ford Motor’s high stock closing price was 42.45 on May 03, 1999.
The company operates three fundamental segments :
- Automotive is engaged in developing, manufacturing, marketing, and servicing of Ford cars.
- Mobility is a segment that includes Ford Smart Mobility LLC and autonomous vehicles business.
- Ford Credit indicates to vehicle-related financing and leasing activities.
By the year 2010, the company goal was to reduce their global CO2 emissions per vehicle produced by 30% by 2025, the surprise is that 8 years later they made it, that year they launched a ground-breaking program in Jeddah, Saudi Arabia, and more.
Ford also one of the founders of IONITY, and all that was in 2017-2018, the company has a long history of operating under sound corporate governance. Basically, their cooperate officers and some of the directors had ensured their dedication to serve the interests of their shareholders and create long-term value.
Ford motor’s dividend strategy is like any other public company, robust stock performance is due to their’s ample dividend. We will talk about Ford stock dividend later in the second section.
Considering the erratic performance for the automaker industry for did a pleasant result its 16% year. and it’s one of the tops most valuable publicly-traded auto companies. But…
Furthermore, CNN businesses reported that ford’s wheeling to spend over $11 billion over the next three to five years on a plan to revitalize its business, and in the other hand the wall street analysts did show some concerns about ford’s plan, and some expected 2020 revenues to fall 0.9%.
Although, Ford dividend performance past years is underwhelming but remains impressive at a forward dividend yield of 6.7%.
So far now seems ford is on the downside and already 2020 and this remains a mystery for investors and shareholders, and the experts don’t think that Ford is going to keep up against rivals, General Motors Co, Fiat Chrysler, and Tesla.
Are ford stocks dividend worth the risk?..well I will let the numbers and the dividend stock history answer you in the next section
2-Ford’s growth and dividend analysis
Despite that, the ford motors are moving forward in the right direction but didn’t perform well in the market for the past years, yet somehow investors aren’t exactly panicked because for the long run F sees the potential of growth.
The year 2019, ford started to focus on restricting its business in targeted countries especially in Europe, so to achieve that and maintain sustainability and manage the costs, F started an approach which includes selling closing or selling six of the company’s 24 facilities in Europe along with discounting some brands C-MAX, Grand C-MAX, and KA+.
By doing so Ford motors will return in growth on European territories after the unlucky past years. The 2019 quarterly reported that nearly all regions that F operates had experienced a drop-down :
- Ford’s market share worldwide 6.2%, which means a drop of 50 bps from the 2018 quarterly results.
- North America’s market share was 12,8% after the drop become 7%, a drop of 20 bps.
- China’s market share dropped to 2.3%.
- European market share rolled down 20 bps to 6.7%.
The Middle East and Africa was Ford’s exception, the same results founded an increase up 50 bps to 3.1%, even though revenue was lower by 26%.
In 2017, Ford’s annual revenue was $156.776B. This is a 3.28% increase from 2016. Ford successfully increased it annual revenue $160.338B in 2018, which is a 2.27% increase compared to previous year. However, Ford’s annual revenue decreased to $155.9B in 2019, big 2.77% decline from 2018.
The bottom line is, keeping your eye on Ford’s share and revenue will prevent you from the risks and is a good chance to make even more cash flow, you can never know whether ford divined stocks will increase or decrease.
Ford stock dividend; payout and price of the past eight years
- The current TTM dividend payout for Ford Motor as of February 20- 2020 is $0.60.
- The dividend yield for Ford Motor as of February 20-2020 is 47%.
The 2007-2008 financial crisis led F to cut and eliminate its dividend, the cut was about 38% from $0.40 in 2005, to $0.25 in 2006. and here are Ford’s adjusted earnings-per-share results before and during the financial crisis :
- The year 2005 ford’s adjusting earnings per share was $1.25, a dividend yield of 4,91%, and paid a quarterly dividend of $0.27 per share.
- The year 2006 ford’s adjusting earnings per share was $1.50, a dividend yield of 4,45 with payouts dividend of $0,28 per share by the first quarter, and in the last quarter a dividend yield of 5,15%, also dividend payouts of $0,25 per share.
- The year 2007, Ford’s adjusted earnings-per-share: $0.19
- The year 2008, Ford’s adjusted earnings-per-share: $3.13
- The year 2009, Ford’s adjusted earnings-per-share: $0.00
- The year 2010, Ford’s adjusted earnings-per-share: $1.91
- The year 2011, Ford’s adjusted earnings-per-share: $1.95
As you can see the automaker company experienced a serious decline for all of the revenue, dividend yield, divined payout and earning per share. which caused a drop-down of adjusting per share at $0,00 in 2009.
Well, it’s not surprising that ford motors cut and eliminated it’s stock dividend leading up to the last financial crisis, and has chosen the constant alternated between growth and declines over the last 15 years.
Listed below are Ford’s dividend yield after the recession (the last quarter of every year) :
- 2012 TTM dividend yield of 1,78%, TTM dividend payouts $0,15, and stock price 8,21
- 2013 TTM dividend yield of 2,29%, TTM dividend payouts $0,30, and stock price 13,10
- 2014 TTM dividend yield of 3,68%, TTM dividend payouts $0,40, and stock price 10,80
- 2015 TTM dividend yield of 3,95%, TTM dividend payouts $0,48, and stock price 12,41
- 2016 TTM dividend yield of 7,01%, TTM dividend payouts $ 0,72, and stock price 10,28
- 2017 TTM dividend yield of 5,28%, TTM dividend payouts $0,58, and stock price 11,09
- 2018 TTM dividend yield of 8,45%, TTM dividend payouts $0,70, and stock price 8,27
- 2019 TTM dividend yield of 6,64%, TTM dividend payouts $0,60, and stock price 9,03
- 2020 TTM dividend yield of 6,77%, TTM dividend payouts $0,60, and stock price 8,86. And as of February 20-2020 ford’s dividend yield of 7.47%, and dividend payouts remain stable at $0,60.
In the second quarter of 2019, F paid a quarterly dividend of $0.15 per share by using adjusted per share of $0,28, indicate to divined payout ratio of 54%. also the company has managed to produce adjusted per share of $1.31 for the last four quarters with a sustainable payout at $0,60.
In other words, the increase results in a payout ratio of 46% which is above Ford’s average payout ratio of 34% since 2012.
You probably wondering about Ford’s cash flow, so let’s get back to the second quarter of the year 2018, Ford managed to generate $4.5 billion of free cash flow and $8.9 billion over the last four quarters.
In the second quarter ford distributed $599 million of dividend, This results in a payout ratio of 13%. And paid $2.4 billion to shareholders in the shape of dividends in the last four quarters for a payout ratio of just 27%.
Are ford stock divined good for investors?
It’s an undeniable fact that Ford’s stocks could be at risk in case of other recession the following years, for many reasons the cash flow payouts ratios considered low and the company isn’t doing a great job to produce a consistent free cash flow.
Furthermore, Ford motor plans to replace 75% of its unpopular products with new models and to get in the electric cars industry, and wall street’s boys aren’t excited for ford’s new plan.
Yet, even without any dividend growth, ford’s divined yield of 7,47% could offer investors a huge amount of income. and could also be an interesting decision for long-term investment goals. that’s why we strongly suggest that the stock only be bought by investors who understand the risk they take.
Looking closer at the date we reveal that baying Ford stock dividend may be a risky choice, but the last four quarters give a good impression that Ford’s has seen a decent upswing through this period.
The bottom line while earning per share and payouts ratios looks in a good form, the auto company’s revenue and cash flow are very inconsistent, which could result to lower or eliminate ford’s dividend in the next recession.