Ford shifted away from electric vehicles, saying it would no longer make the F-150 Lightning.
A fire at a supplier led to a $1.5- billion-$2 billion production loss.
Policies under President Trump have favored combustion vehicles over EVs.
Shares of Ford Motor (NYSE: F) were among the winners last year as the long-suffering legacy automaker gained traction through a pivot away from electric vehicles toward traditional combustion and hybrid vehicles.
The company also managed to overcome concerns around tariffs, and saw strength in the pro segment. Additionally, software and services were a bright spot for the company, and its pickup trucks and SUVs performed well.
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According to S&P Global Market Intelligence data, the stock finished the year up 33%. As you can see from the chart below, the stock moved sideways for the first three months of the year before steadily rising over the rest of the year.
The biggest news from Ford last year was its pivot away from electric vehicles, which comes both as President Trump has made policy changes that favor combustion vehicles, and removed a key subsidy for EVs, and as growth in the electric vehicle sector was already slowing.
The company said it would discontinue its electric F-150 Lightning trucks and cancel plans for other large, fully electric trucks, focusing instead on hybrid vehicles and smaller, cheaper EVs.
That move, which Ford announced in December, will lead to a $19.5 billion non-cash impairment charge, but the move should boost profits over the foreseeable future, excluding that charge, as the EV business had been responsible for significant losses.
Through the first three quarters of the year, revenue rose 3% to $141.4 million, and adjusted operating income actually fell from $8.1 billion to $5.7 billion, though that was largely related to a fire at a Novelis plant, a key supplier, in upstate New York.
However, the company executed on key strategic initiatives, and investors believe it is positioned for solid profit growth in 2026.
Image source: Ford.
With the company having shifted its strategy to higher-margin combustion and hybrid vehicles and its efforts to put the Novelis fire in the past, Ford seems well-positioned for 2026.
Investors expect profit growth to return, forecasting adjusted earnings per share of $1.52, up from a projected $1.10 in 2025.
Based on that forecast, the stock trades at roughly 9 times earnings. While Ford is sensitive to macroeconomic conditions, if the economy remains steady, the automaker looks like it’s in position for more gains this year.
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Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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