Jefferies Turns Bullish on Ford, GM Profit Outlook

Written by Sandra Leggero

Sandra Leggero has a background in financial markets, having spent more than 9 years in commodities trading for several European and Asian companies. She holds a degree in Economics from the University of Pavia and specializes in emerging markets.

, | Updated: July 27, 2026

Key Moments

Jefferies upgraded Ford Motor and General Motors to Buy from Hold, citing improving U.S. auto fundamentals and stronger capital allocation.
Ford’s price target was raised to $17.50 from $14.50, with Jefferies viewing the second quarter as a potential margin trough and lifting its 2026 adjusted EBIT forecast to $10.3 billion.
GM’s price target was increased to $99 from $90, with Jefferies now expecting more than $10 billion in annual free cash flow from 2027 and upside to earnings estimates through 2028.

Jefferies Turns Positive on U.S. Auto Majors

Jefferies upgraded both Ford Motor and General Motors to Buy from Hold, pointing to a healthier backdrop in the U.S. auto market, improved capital allocation, and easing legacy cost burdens. The brokerage argued that these factors set both companies up for stronger earnings and cash generation over the next two years.

Ford: Margin Trough and Upgraded Outlook

For Ford, Jefferies raised its price target to $17.50 from $14.50. The firm indicated that second-quarter performance is likely to mark a low point for margins as vehicle production stabilizes following prior supply disruptions.

Jefferies indicated that Ford’s management could raise full-year guidance, supported by solid U.S. demand, improving warranty trends, a more focused electric vehicle strategy, and ongoing efforts to shrink its manufacturing footprint in Europe.

Ford – Jefferies Metrics and Views	Detail
Rating Change	Upgraded to Buy from Hold
Price Target	Raised to $17.50 from $14.50
2026 Adjusted EBIT Forecast	$10.3 billion
2Q Adjusted EBIT Forecast	About $2.5 billion
2Q Margin Assumption	5.4%
2Q Wholesale Volume Change	Estimated 10% decline

The brokerage lifted its 2026 adjusted EBIT forecast for Ford to $10.3 billion, which it described as near the upper end of the company’s own guidance. Jefferies added that free cash flow should benefit as inventories are rebuilt, supplier compensation falls, and warranty expenses decline.

Longer term, the firm expects Ford’s next-generation universal EV platform and ongoing battery investments to bolster profitability and help narrow what it sees as a valuation discount relative to General Motors.

Ford Earnings Preview

Ahead of Ford’s July 28 earnings release, Jefferies projected second-quarter adjusted EBIT of about $2.5 billion, corresponding to a 5.4% margin. This comes despite an estimated 10% drop in wholesale volumes, with the firm noting that tariff benefits and lower material and warranty costs are expected to partially counterbalance weaker production.

GM: Strengthened Confidence Post-Earnings

Jefferies also moved General Motors to a Buy rating, raising its price target to $99 from $90. The shift followed GM’s second-quarter earnings, which the firm said reinforced its confidence that profitability and free cash flow in 2027 will continue to improve.

The brokerage now expects GM to generate more than $10 billion in annual free cash flow from 2027, supported by upcoming truck launches, efficiency improvements, and a growing contribution from digital services.

GM – Jefferies Metrics and Views	Detail
Rating Change	Upgraded to Buy from Hold
Price Target	Raised to $99 from $90
2026-2028 Earnings Estimates	Increased by around 6%
Expected Annual Free Cash Flow (from 2027)	More than $10 billion
Implied 2027 Valuation Multiple	Roughly five times expected 2027 earnings

GM Earnings and Valuation View

Jefferies increased its 2026-2028 earnings estimates for GM by around 6%. The firm highlighted better warranty performance, firm pricing, reduced EV restructuring costs, and the strength of GM’s North American truck business as reasons it sees scope for further earnings upgrades.

The brokerage described GM’s valuation as compelling at roughly five times its expected 2027 earnings, and noted that additional share repurchases provide further support for the stock.