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As an iconic American carmaker with a $56 billion market cap, Ford (NYSE: F ) unsurprisingly has generated plenty of retail and institutional interest. Last year, Ford was among the top 45 most-owned stocks by investment clubs, as measured by the folks at Better Investing. If retail investors were high on the stock, it got me to thinking: What's the consensus sentiment view on Ford?
Turns out, the view is "mixed." Let's have a look at a few of the key sentiment drivers.
1. Analyst opinion
Analysts have a favorable opinion of Ford. Data from Yahoo! Finance captures their collective feeling:
Number of Analysts
Four analysts have a "strong buy" rating, with an additional seven "buys" and "holds." There's a lone "sell" rating mixed in.
For purposes of this exercise, we'll classify analyst opinion as "mostly bullish."
2. Insider buying
Next we'll look at insider buying and selling. Over the past year, Ford insiders have sold $111 million worth of their company stock. During the same time period, insiders didn't buy a single share of stock. (Data from Form4Oracle.)
Although $111 million of net insider selling isn't all that meaningful relative to Ford's market cap, and even though insiders sell stock for a whole host of reasons -- to pay for a house or tuition, to diversify assets, and so forth -- it would be nice to see some insider buying. For Ford, we'll classify insider buying/selling as bearish.
3. Guru buying
Next, we'll look at "guru" ownership of the stock. According to GuruFocus, in the quarter ended Dec. 31, four investing gurus were buying Ford and three were selling. Among the buyers were George Soros and Chris Davis; Jean-Marie Eveillard and Ken Heebner (known for moving in and out of positions quickly) were sellers. In the previous quarter, four gurus were buying, versus two sellers. (Adding to the positive sentiment, Ford is also a recommendation in our Motley Fool Stock Advisor flagship newsletter service.)
Though the guru picture is mixed, more gurus were buying than selling, so we'll call the trend "somewhat bullish" for Ford.
4. Retail-investor community sentiment
For retail-investor community sentiment, I turn to Motley Fool CAPS, our proprietary stock-rating system. CAPS generates ratings on a one- to five-star scale, with five stars as the highest ranking, indicating that the Fool community believes in a stock's future. Ford has a neutral three-star rating.
5. Short sellers
Next we'll look at whether short sellers are circling the stock. There are 181 million Ford shares sold short, according to Capital IQ. As a percentage of shares outstanding, that's a short interest of 4.8%. That's higher than I'd like to see, although it's nowhere near the 13.3% short interest for struggling bookseller Barnes & Noble. For determining sentiment, we'll classify this one as "neutral-to-bearish."
6. Does Buffett own it?
This is the "cherry on top" test, and in Ford's case, it's a no: Berkshire Hathaway does not own shares of Ford.
Adding it up
Analysts and gurus are positive on Ford, while the CAPS retail investor community is neutral. Short interest is a little higher than I like to see -- a neutral-to-bearish sentiment indicator -- and insiders have been selling over the past year without a single buy. Berkshire doesn't own shares of Ford, either.
Add it all up, and Ford comes out with a consensus sentiment of "mixed" -- there are some bullish signs and some bearish signs.
Of course, you can't base an investment philosophy on who likes or dislikes the stock you own, and a consensus bullish opinion can sometimes be a scary thing. Quoting Buffett: "A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful." There's no sense of either greed or fear circling Ford right now, though.
The purpose of this series of articles isn't to make a definitive buy-or-sell call. Rather, by looking at a stock's sentiment, the goal is to help you place your own opinion of it in a broader context.
One final thing: If you want to keep tabs on Ford's movements, and for more analysis on the company, make sure you add it to your Watchlist.