Is Holding Ford Stock a Smart Strategy for Beating the Market? Historical Trends Suggest Otherwise

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Ford Reports Strong Q3 Sales Growth

Ford Motor Company (NYSE: F) reported an 8.2% increase in U.S. unit sales year over year for the third quarter ended September 30. Key models contributing to this growth include the F-Series pickup trucks, Mustang Mach-E, Expedition, and Bronco. As of October 10, Ford’s shares have increased by 15% this year.

Long-Term Performance and Valuation Concerns

Historically, Ford has underperformed compared to the S&P 500, generating total returns of 33% over the past 10 years and 150% over 20 years. The current valuation shows a forward price-to-earnings ratio of 9 and a dividend yield of 5.26%. However, analysts caution that Ford’s characteristics—low growth, weak margins, and high capital expenditures—suggest its valuation may remain low.

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