Critical Analysis: Mercedes-Benz Group (OTCMKTS:MBGYY) and Ford Motor (NYSE:F)

Mercedes-Benz Group (OTCMKTS:MBGYY) and Ford Motor (NYSE:F) are both large-cap auto/tires/trucks companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, earnings, risk and analyst recommendations.

Volatility and Risk

Mercedes-Benz Group has a beta of 1.22, meaning that its share price is 22% more volatile than the S&P 500. Comparatively, Ford Motor has a beta of 1.63, meaning that its share price is 63% more volatile than the S&P 500.

Profitability

This table compares Mercedes-Benz Group and Ford Motor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mercedes-Benz Group	7.36%	11.66%	4.11%
Ford Motor	1.93%	16.16%	2.53%

Institutional & Insider Ownership

58.7% of Ford Motor shares are owned by institutional investors. 0.4% of Ford Motor shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations for Mercedes-Benz Group and Ford Motor, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mercedes-Benz Group	1	4	0	0	1.80
Ford Motor	3	8	3	0	2.00

Ford Motor has a consensus price target of $11.96, indicating a potential upside of 28.93%. Given Ford Motor’s stronger consensus rating and higher possible upside, analysts plainly believe Ford Motor is more favorable than Mercedes-Benz Group.

Valuation and Earnings

This table compares Mercedes-Benz Group and Ford Motor”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mercedes-Benz Group	$165.81 billion	0.34	$15.43 billion	C$2.88	5.16
Ford Motor	$176.19 billion	0.21	$4.35 billion	$0.88	10.54

Mercedes-Benz Group has higher earnings, but lower revenue than Ford Motor. Mercedes-Benz Group is trading at a lower price-to-earnings ratio than Ford Motor, indicating that it is currently the more affordable of the two stocks.

Summary

Ford Motor beats Mercedes-Benz Group on 9 of the 14 factors compared between the two stocks.

About Mercedes-Benz Group

Mercedes-Benz Group AG operates as an automotive company in Germany and internationally. It operates through Mercedes-Benz Cars, Mercedes-Benz Vans, and Mercedes-Benz Mobility segments. The company develops, manufactures, and sells cars and vans under the Mercedes-Benz, Mercedes-AMG, Mercedes-Maybach, G-Class brands, as well as related spare parts and accessories. It also provides financing, leasing, car subscription and rental, fleet management, insurance brokerage, and mobility services, as well as digital services for charging and payment. The company was formerly known as Daimler AG and changed its name to Mercedes-Benz Group AG in February 2022. Mercedes-Benz Group AG was founded in 1886 and is headquartered in Stuttgart, Germany.

About Ford Motor

Ford Motor Company develops, delivers, and services a range of Ford trucks, commercial cars and vans, sport utility vehicles, and Lincoln luxury vehicles worldwide. It operates through Ford Blue, Ford Model e, and Ford Pro; Ford Next; and Ford Credit segments. The company sells Ford and Lincoln vehicles, service parts, and accessories through distributors and dealers, as well as through dealerships to commercial fleet customers, daily rental car companies, and governments. It also engages in vehicle-related financing and leasing activities to and through automotive dealers. In addition, the company provides retail installment sale contracts for new and used vehicles; and direct financing leases for new vehicles to retail and commercial customers, such as leasing companies, government entities, daily rental companies, and fleet customers. Further, it offers wholesale loans to dealers to finance the purchase of vehicle inventory; and loans to dealers to finance working capital and enhance dealership facilities, purchase dealership real estate, and other dealer vehicle programs. The company was incorporated in 1903 and is based in Dearborn, Michigan.