Citi's Michael Ward Upgrades Ford to Buy, Sets Street-High $20 Target

Citi Flips From Hold to Buy

"The next two years will be among the most important in the history of Ford Motor Company," Ward wrote in a note. "Ford's stock has been out of favor on the street," he said. "We believe the momentum is turning."

Why Ward Turned Bullish

In Ward's view, Ford's fledgling energy storage arm could benefit from the surging electricity needs tied to artificial intelligence. Shares jumped over 44% during May, propelled by the AI rally. Ford shares have climbed 13% so far in 2026, outpacing the S&P 500 Index's 8.7% advance. The stock remains one of the least expensive names in the S&P 500.

Ford beat consensus estimates in the second quarter and issued a more upbeat profit forecast for the year. Resilient demand for classic pickups and SUVs also bolstered the balance sheet in the latest quarter. Wall Street's 2027 earnings forecasts for Ford have climbed 23% over the past year.

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According to Ward, the resilience of Ford's traditional operations better equips the company to fund growth areas such as energy storage and subscription services. Ward also noted faster F-Series pickup output, projecting a 28% rise in second-half production that he said would benefit Ford Pro and Ford Blue. He also said that while the company's "ability to monetize the energy business is still a few years away," the higher-margin potential of that business is what makes the initiative compelling.

Most Analysts Are Still Skeptical

Over the past five years, GM shares have risen 56%, while Ford has gained 6.5%.

RBC's Tom Narayan said GM starts from a stronger base, making it difficult to compare its strategy with Ford's. He adds that Ford's Q2 performance suggests the company could be in the early stages of a turnaround, especially as EV losses narrow.

Morgan Stanley's Andrew Percoco also likes Ford's energy storage business, saying there could be "substantial" earnings growth if its universal EV venture succeeds. He now has a $15 price target, up from $14. "Their execution track record has definitely started to improve," Percoco said.

Narayan set a $15 price objective, up from $13, while keeping his neutral rating. He said a turnaround is "not a done deal." "There's initial signs of improvement, but it's not a foregone conclusion that we're going to get there," he said.

During Tuesday's earnings call, Ford executives declined to discuss 2027 profit expectations. That ambiguity was a key factor behind RBC's decision not to upgrade the stock to buy from neutral.

Ford, like other auto manufacturers, must operate in an uncertain macro climate. Tariffs, changing U.S. EV policies, and intensifying competition from Chinese automakers have pressured the company's bottom line, according to Narayan.

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