How to Buy Ford Shares UK – Beginner’s Guide
Ford Motor Company has been trading on the New York Stock Exchange (NYSE) since the mid-1950s. Although the car manufacturer is worth just a fraction of its former glory, Ford still remains one of the most-traded stocks in the US market.
In this guide, we show you how to buy Ford shares online in the UK and discuss which brokers offer Ford shares as a tradeable asset.
Find a UK Stock Broker to Buy Ford Shares
If you want to buy Ford shares online in the UK, you will first need to find a suitable broker.
Not only does the stock broker need to give you access to the NYSE, but it needs to offer reasonable fees and commissions.
1. Fineco Bank
Another option that you have at your disposal is Fineco Bank. The provider covers traditional assets like stocks and ETFs, as well as CFD trading markets. If you decide to buy Ford stocks from Fineco, you will pay a commission of $3.95 per slide.
This means that you pay the fee when you buy the shares and again when you sell them. Additionally, you will need to pay a 0.25% annual maintenance fee on the total value of your portfolio. If you decide to trade Ford shares via CFDs, Fineco Bank allows you to do this on a commission-free basis.
As we discussed earlier, trading Ford CFDs not only allows you to apply leverage but short-sell the stocks, too. Fineco Bank, although not commission-free on traditional shares, does have a large asset library. For example, it offers tens of thousands of stocks and ETFs across dozens of UK and international exchanges.
You are only required to meet a £100 deposit at this platform – which comes with transaction fees. However, you do need to wait 1-2 working days for the funds to arrive, as the only deposit method is a bank account transfer. Nevertheless, Fineco Bank is regulated by the FCA, and by choosing this broker – you’ll be covered by the FSCS.
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Research Ford Shares
Like any investment that you are considering making, it’s important to perform some independent research before making a purchase. This is especially crucial in the current economic climate that is still dominated by the uncertainties of COVID-19.
With this in mind, below you will see a wealth of information about what to consider before you buy Ford shares online in the UK.
Ford Share Price History & Market Capitalisation
Listed on the NYSE in 1956, Ford is one of the oldest stocks in the US marketplace. Naturally, early backers of Ford as a public company were rewarded handsomely in the decades to follow. Over the course of its life as an NYSE constituent, Ford has executed 8 stock splits.
With that said, and based on adjusted prices for the aforementioned splits, Ford shares last peaked in 1999 at just over $90. Fast forward to early 2021, and the same shares are worth just over $10.
This represents a rapid capitulation from its prior highs. This is large because Ford no longer enjoys the dominance of the US automobile space that it once had. Nevertheless, as a potential Ford investor, you should concentrate on what the future holds as opposed to fixating on its prior glory.
In more recent times, Ford shares have performed really well since their March 2020 lows of $3.96. With the shares breaching $12 each, in January 2021, this represents an increase of over 200% in just 10 months of trading. This has resulted in Ford increases its market capitalization to more than $42 billion.
Ford EPS and P/E Ratio
As per its most recent earnings report of Q4 2020, Ford stocks are carrying an EPS of -0.07. This figure is negative to represent Ford’s Q4 2020 losses. As of late January 2021, the Ford P/E ratio stood at just over 55.
According to third-party commentators, the average P/E ratio of the US automobile industry is 16. Based on this metric, Ford shares could be overvalued, relative to the industry as a whole.
Ford Shares Dividend Information
Yes, Ford is a dividend stock, so as an investor you will be entitled to your share. Its most recent distribution amounted to $0.15 per share, which is the same dividend size since 2015.
Ford is also known to pay special dividends too, albeit, this is announced on a sporadic basis. With that said, whether or not Ford’s dividend policy is safe moving forward remains to be seen.
After all, management at Ford has since announced that tough decisions may have to be made in 2021.
Why Do People Invest in Ford Shares?
So now that we have explored the firm’s recent share price action and dividend policy, we are now going to dive a little deeper into Ford as an investment:
Partnership With Google
One of the most notable stories in recent weeks is that the firm has formed a potentially lucrative partnership with Google.
The partnership – which is based on a 6-year deal, will see Google’s Android operating system powered into Ford cars. This is great news for shareholders, as it shows that management at Ford is keen to bring the age-old carmaker into the 21st century.
In particular, Google’s technology will function around cloud computing, AI, and machine learning. Not only will this revolutionize the ‘driving experience’, but it will allow Ford to drastically improve efficiency in its supply chain and production facilities.
Ford Shares Trajectory
Although you would expect a major carmaker to have suffered greatly as a result of wider lockdown measures, Ford shares have risen since hitting lows of sub-$4 in March 2020.
In fact, with the shares since surpassing $12, those that bought the dip are now looking at gains of over 200%. Not bad for a company that is currently going through a major cost-reduction plan to reshape its finances.
In addition to this – and as noted earlier, management at Ford has resisted plans to cut or suspend its dividend payment. Although it remains to be seen if the firm will continue to meet its long-standing distribution policy, COVID-19 is yet to have its say on Ford dividends.
Impending One-Off Charges
Management at Ford recently announced that it is expecting a number of one-off charges – some of which are of significant size. For example, there is an expected $2.5 billion charge related to its closure of three manufacturing plants in Brazil.
Then there is a $1.5 billion expected charge related to its ever-growing pension fund. Additionally, there is an expected $610 million charge related to a major vehicle recall. This was due to a fault with airbags.
Although Ford has been transparent with these expected outgoings, they are heft charges nonetheless.
Open an Account and Deposit Funds
If you’ve read through our sections on the fundamentals of Ford shares and wish to proceed with an investment, the next step is to open an account with your chosen broker.
To get the ball rolling, head to your broker’s website and choose to sign up.
You will then be asked to enter the following information:
- Full name
- Home address
- Date of birth
- National insurance number
- Email address
- UK mobile number
- Username and password
After that, your broker will likely ask you to upload a copy of your:
- Passport or driver’s license
- Recently-issued bank account statement or utility bill
This is to ensure that the broker complies with FCA regulations. After this, you can make a deposit, with the following being some of the most popular payment methods:
- Debit/credit cards
- Bank transfer
How to Buy Ford Shares
The final step of the process is to search for Ford shares and place an order. Search for Ford in your broker’s dashboard and opt to ‘Trade’.
Then, you need to enter the amount that you wish to invest in Ford shares. This needs to meet your broker’s minimum investment amount.
Once you are happy, confirm the trade, and the position will be executed at the market rate.
Note: If you are buying Ford shares outside of NYSE trading hours, you’ll need to set the order for later. Your broker will then complete your order when the markets reopen.
Is It a Good Idea to Buy Ford Shares?
On the one hand, it is true that Ford no longer dominates the US automobile industry. With the likes of Tesla now being preferred by investors, Ford shares are worth a fraction of prior highs. With that said, Ford has risen in recent months, with the shares increasing by more than 200% since March 2020.
Additionally, exciting times could be in the making for Ford as per its recent partnership with Google. This has the potential to completely revolutionise the way US consumers view Ford and thus – bring the carmaker into the 21st century.
Although Ford shares are listed in the US, making an investment from the UK is still a possibility.
Best of all, many UK-based brokers are FCA-regulated, meaning that you can invest and still be covered by a significant degree of investor protection. Finally, many brokers even have FSCS coverage, which insures you up to £85,000 in the instance that your broker goes bankrupt.
Which stock exchange are Ford shares listed on?
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Does Ford offer dividends?
How much is Ford valued at?
Who is the Chief Executive Director of Ford?
Can I invest in Ford shares via an ISA or SIPP?