Ford owns the F-Series, America's best-selling vehicle line for decades and a huge profit center for the Blue Oval. It also owns a ton of advanced technology that will keep it in a leading position for decades to come. Shares dropped sharply this week on short-term concerns. Value investors should take note. Image source: Ford Motor Company.

Shares of Ford Motor Company (F -1.06%) dropped 8.2% on July 28 after the company's second-quarter profit missed expectations and executives warned that their full-year guidance was at risk. 

That seems like bad news. Is it finally time to sell your Ford stock?

I think it might be an opportunity to buy more. Here's why.

The bad news might be overblown

Ford CFO Bob Shanks emphasized during the earnings call that despite a 9% year-over-year drop in net profit, the second quarter was still a very good one for the Blue Oval. 

All things considered, he's right. The U.S. new-car market may be at a plateau after years of growth, but it's a high plateau that might be sustainable for several more quarters, with strong sales in the most profitable market segments. 

The bad news, one of the factors that worried investors, is that Ford's incentives were up year over year. But Shanks noted that Ford's incentives were unusually low in the second quarter of last year. That's because Ford was still ramping up production of its best-selling model, the then-new F-150. Its truck incentives were low a year ago because supplies were very tight. That led to an exceptional profit margin in the second quarter of last year, but it wasn't sustainable. 

Now, things have returned to "normal" -- except that incentives have been slowly rising across the industry because sales growth has stalled, and Ford's have been keeping pace. Those incentives probably dented the profit margin in its North America unit: It was down from a year ago, but still extremely strong at 11.3%.

Abroad, Ford's road in China has hit some bumps lately, as domestic Chinese automakers have upped their game at the lower ends of the market. That has put some pressure on Ford's pricing, and cost it some market share. But Ford's market share is already trending back up (from 4.1% in April to 4.7% in June), and it's moving to reduce the costs of its most affordable Chinese products, the Escort sedan and EcoSport SUV. 

The new Ford Edge is a huge hit in China. Ford will increase local production of the popular crossover by the fourth quarter, one of several steps that should boost the Blue Oval's China profits. Image source: Ford Motor Company.

Later this year, Ford will launch a new version of its Taurus sedan in China that will be positioned to take advantage of a tax break for fuel-efficient vehicles, and it will also increase local production of its hot-selling and very profitable Edge SUV. 

Long story short: Ford's performance in North America remains strong, and it is making adjustments in China to ensure that its performance there will be strong by the end of the fourth quarter. Or put another way, these are short-term concerns, and that opens an opportunity for long-term-minded investors. 

There's also very good news: Europe is now a profit center

Ford lost billions in Europe earlier this decade. But now, Europe is a strong profit center for the Blue Oval. Ford earned $467 million in Europe in the second quarter. It's realizing the fruits of a turnaround plan set in motion by former CEO Alan Mulally in 2012, which closed unneeded factories and added more profitable products to the European lineup. Ford's second-quarter profit in Europe was a record, but the best news is that it could get even better from here. Europe chief Jim Farley is working on additional cost cuts and product-lineup tweaks, looking to sustain (or improve on) Ford's good 5.8% profit margin last quarter. 

Ford Europe is evolving from a money-losing operation into a sustainable profit center. It's close to the point where we will be able to count on it to add $1.5 billion or more to Ford's pre-tax income every year. That's a big swing from the billion-dollar annual losses it was posting as recently as 2014. 

Ford's long-term outlook is still very positive

Ford is very profitable in North America, well-positioned in China, and making more money than ever in Europe. The past week's drop means that Ford is now trading at less than six times its last four quarters' earnings, making the stock dirt cheap by historical standards (10 times earnings would be more typical). Its dividend yield of 4.7% is very strong.

What's more, that dividend is probably sustainable even if the U.S. should fall into recession. Ford has a huge cash hoard ($27.2 billion as of the end of the second quarter) intended to ensure that it can continue to fund its commitments (including an aggressive new-product plan and spending on future technologies) even if its profits are squeezed during the next recession.

Snow and ice pose huge challenges for self-driving cars. Unlike most rivals, Ford has made a point of testing its self-driving prototypes in tough winter conditions. Image source: Ford Motor Company.

And as for that technology: There's a lot of talk about auto-industry disruption from new entrants in Silicon Valley and new technologies like electric cars and autonomous driving. Your humble Fool, who gets paid to watch all of this carefully, thinks that there will be winners and losers among the current established automakers -- and Ford's management has made the right commitments to keep the Blue Oval in the winning column. 

Ford hasn't talked about it as much as some rivals, but the company is putting a lot of effort and resources into its self-driving-car program, and it has a comprehensive plan to roll out advanced hybrids and electric vehicles across its lineup, around the world, over the next decade or so. (It's already a leading player in hybrids, and has been for several years now.) 

When the market shift to electric vehicles and self-driving technologies gets under way in earnest, I'm convinced that Ford will be ready to continue to be a major global player -- and a profitable one.

The upshot: This big price drop is a buying opportunity

Ford will never be a flashy growth stock. But it is positioned for some real growth in coming years, as it continues to build out its already-strong position in Asia, reap the benefits of its work in Europe, and take advantage of growing global demand for trucks and crossover SUVs. Its veteran management team, from CEO Mark Fields on down, has shown over and over that they're ready and able to steer Ford safely through any storms that might arise. Meanwhile, Ford is paying a steady, sustainable dividend that looks even stronger given what happened to the stock this past week.

Simply put, Ford's long-term trajectory is still strong. Value-minded investors who buy at these prices, reinvest the dividend, and stay patient even if the economy dips for a while stand a very good chance of being well rewarded.