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Ford is making big investments abroad in an effort to diversify its profit sources, but for now it remains highly dependent on sales of its F-Series pickups in the U.S. The good news: Those look set to rise in 2015.

Is Ford Motor Company's (NYSE:F) stock a buy right now?

It depends how you look at it. If you look strictly at traditional valuation metrics, such as the price-to-earnings ratio, the stock looks expensive by historical standards. It's not outrageously expensive, but it certainly isn't cheap.

If you look at what Ford is doing to increase its bottom-line results over the next couple of years, the situation looks more promising. But the near-term ride, over the next several months, could be bumpy.

Let's take a closer look.

Ford isn't cheap -- until you look at its Detroit rivals

On the surface, Ford had a tough year in 2014. Pre-tax profit fell more than 26% from the company's superb 2013 result, while the stock price rose less than 1% over the course of the year.

As I write this, Ford's shares are trading near $16. With $0.80 a share in net earnings over the last four quarters, that gives us a price-to-earnings ratio of almost 20.

If you're used to high-flying tech stocks, that might sound pretty reasonable. But it's expensive for an automaker, even one with a dividend yield close to 4%. Normally, we'd expect a price-to-earnings ratio near 10, maybe a little higher.

Here's how Ford's valuation stacks up against its key global competitors.

Pe Ratios

Source: S&P Capital IQ.

As you can see, Ford's valuation is high relative to that of its foreign competitors, but a little cheaper than Detroit rivals General Motors and Fiat Chrysler Automobiles. But like its U.S. peers, Ford carries a rich valuation because of investor expectations about what it will do in the future, rather than because of what it did in 2014.

(It's also worth noting that GM's seemingly high valuation is a classic case of a P/E ratio that doesn't tell the whole story. General Motors' massive wave of recalls meant big costs that weighed on its earnings in the first half of 2014, but the automaker's underlying business is much stronger than those results suggest. If anything, GM might actually be undervalued at current prices -- but that's a discussion for another day.) 

So at least by this simple metric, Ford stock is fully priced and then some.  But this is where a closer look is warranted: Ford's current valuation is easily supported by its significant potential for growth over the next couple of years.

The bullish case for Ford's earnings: A rebound at home and growth abroad

Right now, Ford's earnings picture is dominated by its North America region, as you can see in the chart below.

Ford

Source: Ford Motor Company.

That chart shows pre-tax earnings for each of Ford's principal business units in 2014. The numbers change from quarter to quarter, but the basic story has been the same for several years: The North America unit has been carrying the company.

What is driving its earnings in North America? A number of factors, but the biggest and most important is sales of full-size pickup trucks in the United States.

The bad news is that Ford's bottom line is heavily exposed to the ups and downs of the U.S. pickup market. We saw that last year, when factory changeovers for producing the new aluminum F-150 constrained truck supplies, sales growth stalled, and Ford's profits dropped. 

The good news is that the market for pickups has been very strong for the last several quarters, and Ford's pickup sales are expected to rebound in 2015. Even better news: Ford is working hard to diversify its earnings sources.

Make no mistake, U.S. sales of pickups will remain key to Ford. But while Europe and Asia haven't historically added much to its bottom line, the company is moving aggressively to change that in a big way.

Europe and Asia will soon play bigger roles in Ford's profit picture

Ford's losses in Europe have been heavy in recent years: $1.75 billion in 2012, $1.6 billion in 2013, and just over $1 billion in 2014. But a restructuring effort begun in 2012 is taking hold: 2015's losses will be lower than 2014's, Ford says, and it expects to break even or turn a profit in 2016.

Meanwhile, in 2012, Ford said it would spend nearly $5 billion on an aggressive expansion effort in Asia. One key goal: a 6% share of China's huge auto market by the end of 2015, up from just 3% in 2012.

Ford's share is closing on 5% now. It sold 1 million vehicles in China in 2014, for the first time ever. It has opened six new Asian factories since 2012, along with a slew of other facilities -- and it has two more Chinese factories under construction, slated to open later this year. It also began rolling out its Lincoln luxury brand to Chinese customers late last year, a move that could boost profit margins if Lincoln sales take off.

The costs of all of that construction and expansion have kept profits in Ford's Asia-Pacific unit relatively modest so far: The unit earned $589 million in 2014. But that should change once those last factories are up and running in a year or so. 

The upshot: A good long-term holding, but you'll need patience

Ford's management isn't a concern. CEO Mark Fields and his team have been through the best and worst of times with Ford, and all seem mindful of the hard lessons learned in the last decade -- but also, determined to bring good growth to Ford in a prudent way. This is a solid leadership team.

But there are some caveats to be aware of before you invest. Deteriorating economic conditions in Europe or China -- or the U.S. -- could throw wrenches into Ford's ambitious growth plans.

And the competition isn't standing still. Toyota, flush with cash thanks to a big exchange-rate advantage, is hinting that it will make an aggressive push for U.S. market share next year. And General Motors is in the midst of a new-product blitz that will leave it with the freshest lineup in the business in a year or so.

As a long-term investment, there's a lot to recommend Ford: strong, forward-thinking management, competitive products, a healthy balance sheet, and a high likelihood of profit growth over the next few years. There's even a solid $0.15-per-share dividend every quarter, up 20% from 2014.

Ford is certainly worth holding on to if you already own it. And it's not a bad buy right now. But you aren't getting a bargain if you buy Ford stock today, and patience though some ups and downs could be required as its global growth story plays out over the next few years.

John Rosevear owns shares of Ford and General Motors. The Motley Fool recommends Ford and General Motors. The Motley Fool owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.