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What's Behind Ford's Approval of a New Share Repurchase Plan?
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Key Takeaways
Ford approved repurchase of up to 31.7M shares to counter dilution from stock compensation and notes.
The buyback offsets increased share count from employee stock awards and maturing convertible notes.
Ford continues similar past buybacks while shifting focus from EVs to hybrid and gas models.
Ford Motor Company (F - Free Report) has approved a plan to repurchase up to 31.7 million shares of its stock, a relatively modest buyback to counteract dilution from employee compensation and other convertible securities.
Per a regulatory filing, the company explained that the buyback is intended to reduce potential dilution of its common stock following the issuance of share-based compensation this year and the maturity of 0.00% convertible notes on March 15.
Per Dave Tovar, Ford’s spokesperson, the initiative is primarily an anti-dilution measure to offset the impact of stock awards granted to many salaried employees earlier this month. When shares are issued as compensation, the total number of shares in circulation increases, which can dilute existing shareholders’ value. Repurchasing shares helps limit that effect.
Ford’s salaried compensation structure includes base pay, an annual cash bonus and annual stock awards. While not all employees receive stock grants, most salaried staff, including senior executives, are awarded shares at varying levels. Ford carried out similar buyback programs following stock-based compensation in 2024, 2023, 2022 and 2021, though not in 2025.
The repurchase plan aligns with Ford’s broader strategy this year to balance a shift in focus from electric vehicles toward hybrid and gasoline-powered models, while maintaining shareholder confidence. The company had previously announced in December that it would scale back its EV plans, a decision expected to result in $19.5 billion in restructuring costs. F carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Share Repurchase Programs by Ford’s Peers
In January, General Motors Company (GM - Free Report) approved a major share repurchase initiative, authorizing a new $6 billion buyback program scheduled to begin in 2026. The announcement came alongside GM’s fourth-quarter earnings release. The latest program adds to a series of large buyback plans introduced in recent years by General Motors, including $10 billion in 2023 and $6 billion programs in both 2024 and February 2025.
Tesla, Inc. (TSLA - Free Report) received a strong boost in investor confidence when Elon Musk invested $1 billion of his own money to purchase additional shares in September 2025. The move helped revive the struggling Tesla stock, pushing it into positive territory for the year. Tesla has been facing increased competition from the EV lineups of other automakers, especially in China.
F’s Price Performance, Valuation and Estimates
Ford has underperformed the Zacks Automotive-Domestic industry in the last six months. Its shares have lost 0.3% against the industry’s growth of 2.7%.
Image Source: Zacks Investment Research
From a valuation perspective, F appears undervalued. Going by its price/sales ratio, the company is trading at a forward sales multiple of 0.27, lower than the industry’s 3.22.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Ford’s 2026 EPS has moved up 9 cents in the past 60 days. The Zacks Consensus Estimate for F’s 2027 EPS has moved up 2 cents in the past 30 days.
Image Source: Zacks Investment Research
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What's Behind Ford's Approval of a New Share Repurchase Plan?
Key Takeaways
Ford Motor Company (F - Free Report) has approved a plan to repurchase up to 31.7 million shares of its stock, a relatively modest buyback to counteract dilution from employee compensation and other convertible securities.
Per a regulatory filing, the company explained that the buyback is intended to reduce potential dilution of its common stock following the issuance of share-based compensation this year and the maturity of 0.00% convertible notes on March 15.
Per Dave Tovar, Ford’s spokesperson, the initiative is primarily an anti-dilution measure to offset the impact of stock awards granted to many salaried employees earlier this month. When shares are issued as compensation, the total number of shares in circulation increases, which can dilute existing shareholders’ value. Repurchasing shares helps limit that effect.
Ford’s salaried compensation structure includes base pay, an annual cash bonus and annual stock awards. While not all employees receive stock grants, most salaried staff, including senior executives, are awarded shares at varying levels. Ford carried out similar buyback programs following stock-based compensation in 2024, 2023, 2022 and 2021, though not in 2025.
The repurchase plan aligns with Ford’s broader strategy this year to balance a shift in focus from electric vehicles toward hybrid and gasoline-powered models, while maintaining shareholder confidence. The company had previously announced in December that it would scale back its EV plans, a decision expected to result in $19.5 billion in restructuring costs. F carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Share Repurchase Programs by Ford’s Peers
In January, General Motors Company (GM - Free Report) approved a major share repurchase initiative, authorizing a new $6 billion buyback program scheduled to begin in 2026. The announcement came alongside GM’s fourth-quarter earnings release. The latest program adds to a series of large buyback plans introduced in recent years by General Motors, including $10 billion in 2023 and $6 billion programs in both 2024 and February 2025.
Tesla, Inc. (TSLA - Free Report) received a strong boost in investor confidence when Elon Musk invested $1 billion of his own money to purchase additional shares in September 2025. The move helped revive the struggling Tesla stock, pushing it into positive territory for the year. Tesla has been facing increased competition from the EV lineups of other automakers, especially in China.
F’s Price Performance, Valuation and Estimates
Ford has underperformed the Zacks Automotive-Domestic industry in the last six months. Its shares have lost 0.3% against the industry’s growth of 2.7%.
Image Source: Zacks Investment Research
From a valuation perspective, F appears undervalued. Going by its price/sales ratio, the company is trading at a forward sales multiple of 0.27, lower than the industry’s 3.22.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Ford’s 2026 EPS has moved up 9 cents in the past 60 days. The Zacks Consensus Estimate for F’s 2027 EPS has moved up 2 cents in the past 30 days.
Image Source: Zacks Investment Research