Analyzing Tesla (TSLA) & Ford Motor (F)

Tesla (NASDAQ: TSLA) and Ford Motor (NYSE:F) are both large-cap auto/tires/trucks companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, profitability, dividends, institutional ownership, valuation, analyst recommendations and earnings.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Tesla and Ford Motor, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tesla 11 10 10 0 1.97
Ford Motor 1 13 6 0 2.25

Tesla presently has a consensus target price of $297.50, suggesting a potential downside of 15.76%. Ford Motor has a consensus target price of $12.69, suggesting a potential upside of 6.14%. Given Ford Motor’s stronger consensus rating and higher probable upside, analysts clearly believe Ford Motor is more favorable than Tesla.

Earnings & Valuation

This table compares Tesla and Ford Motor’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Tesla $11.76 billion 5.07 -$1.96 billion ($11.48) -30.56
Ford Motor $156.78 billion 0.30 $7.60 billion $1.78 6.65

Ford Motor has higher revenue and earnings than Tesla. Tesla is trading at a lower price-to-earnings ratio than Ford Motor, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Tesla has a beta of 0.88, meaning that its share price is 12% less volatile than the S&P 500. Comparatively, Ford Motor has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500.

Profitability

This table compares Tesla and Ford Motor’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tesla -18.77% -40.72% -8.34%
Ford Motor 4.86% 21.31% 2.85%

Institutional and Insider Ownership

60.7% of Tesla shares are owned by institutional investors. Comparatively, 55.3% of Ford Motor shares are owned by institutional investors. 22.8% of Tesla shares are owned by company insiders. Comparatively, 1.0% of Ford Motor shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Ford Motor pays an annual dividend of $0.60 per share and has a dividend yield of 5.1%. Tesla does not pay a dividend. Ford Motor pays out 33.7% of its earnings in the form of a dividend.

Summary

Ford Motor beats Tesla on 11 of the 16 factors compared between the two stocks.

About Tesla

Tesla, Inc. designs, develops, manufactures, and sells electric vehicles, and energy generation and storage systems in the United States, China, Norway, and internationally. The company operates in two segments, Automotive, and Energy Generation and Storage. The Automotive segment offers sedans and sport utility vehicles. It also provides electric vehicle powertrain components and systems to other manufacturers; and services for electric vehicles through its company-owned service centers, Service Plus locations, and Tesla mobile technicians. This segment sells its products through a network of company-owned stores and galleries. The Energy Generation and Storage segment offers energy storage products, such as rechargeable lithium-ion battery systems for use in homes, commercial facilities, and utility grids; designs, manufactures, installs, maintains, leases, and sells solar energy systems to residential and commercial customers; and sell renewable energy to residential and commercial customers. The company was formerly known as Tesla Motors, Inc. and changed its name to Tesla, Inc. in February 2017. Tesla, Inc. was founded in 2003 and is headquartered in Palo Alto, California.

About Ford Motor

Ford Motor Company designs, manufactures, markets, and services a range of Ford cars, trucks, sport utility vehicles, and electrified vehicles; and Lincoln luxury vehicles worldwide. Its Automotive segment sells Ford and Lincoln vehicles, service parts, and accessories through distributors and dealers, as well as through dealerships to fleet customers, including commercial fleet customers, daily rental car companies, and governments. The company's Financial Services segment offers various automotive financing products to and through automotive dealers. Its financing products comprise retail installment sale contracts for new and used vehicles; and direct financing leases for new vehicles to retail and commercial customers, such as leasing companies, government entities, daily rental companies, and fleet customers. This segment also offers wholesale loans to dealers to finance the purchase of vehicle inventory; and loans to dealers to finance working capital and improvement of dealership facilities, purchase dealership real estate, and other dealer vehicle programs. The company was founded in 1903 and is based in Dearborn, Michigan.

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