Recent stock dip is ‘buying opportunity’

Morgan Stanley raised its rating of Ford’s stock to overweight from equal weight on Tuesday, citing a “significant increase” in estimates for Ford earnings over the next three years.

Ford’s recent stock dip is “a buying opportunity,” as it is a “reset of [fiscal year 2019] expectations,” Morgan Stanley analyst Adam Jonas said in a note to investors.

Jonas said his firm likes Ford for three reasons: “Restructuring actions,” “strategic actions” and “product mix enhancement.”

“Our previous concerns over Ford’s ability to maintain its dividend payment have largely subsided,” Jonas added.

Ford shares rose 1.8% in premarket trading from its previous close of $9.23. Morgan Stanley increased its price target on Ford to $12 a share from $10. The stock has fallen nearly 10% in the past month, but is up about 21% so far this year.

– CNBC’s Michael Bloom contributed to this report.