In the past decade, shares of Ford (NYSE: F) have produced a total return, including dividends, of just 30%. If one would've just invested in an S&P 500 index fund, their money would've more than tripled.

Ford bulls are hoping the next few years will end up differently. As of this writing, this auto stock trades 67% below its all-time high. Consequently, the forward P/E ratio is 6.5, which might be enticing for some investors.

So, is it time to buy Ford shares?

Latest business results

Shares of Ford jumped 6% right after it reported 2023 fourth-quarter financial results. It's safe to say that investors were pleased with how the business wrapped up the year.

Ford posted a 4.5% revenue increase in Q4 and an 11.4% rise for the full year. That yearly gain is a much faster clip than investors are used to seeing from this mature company. Ford also reported diluted earnings per share of $1.08 for the full year, a huge improvement from the $0.49 loss in 2022.

The results were good enough for the leadership team to approve a special one-time $0.18 dividend. The stock already yields a 4.95% payout, so this is music to the ears of income investors.

Last year, management made the decision to delay $12 billion of EV (electric vehicles)-related investments due to soft demand and pricing trends. That's not an encouraging sign for a segment that was supposed to be a key business driver in the years ahead. Ford model e, the EV division, reported just a 2% sales increase in Q4, with the operating loss coming in at $1.6 billion.

A bright spot has been Ford's commercial segment, which sells vehicles to enterprise customers. Revenue here was up 19% in 2023, with operating profit totaling $7.2 billion.

Wall Street consensus analyst estimates call for company revenue to rise by 5.8% in 2024. So, there is healthy demand that's forecasted on the horizon. Add this to the $2 billion in cost cuts that executives have planned, and it's understandable for shareholders to be optimistic.

Focus on the bigger picture

Bullish investors have a lot to cheer about right now. Ford appears to be performing well as of late, it pays a hefty dividend, and the stock is cheap. However, I don't think it makes for a solid investment over the long term.

For starters, just look at how intensely competitive the industry is. Ford battles it out against scaled domestic and international rivals that compete all on the same factors, like pricing and design, to draw in consumers. In the EV world, there are deep-pocketed and innovative industry rivals that aim to be at the forefront of the shift in the auto industry. This setup will continue to make it difficult for Ford to achieve outsized success.

Because Ford sells expensive vehicles, which are likely a person's second-biggest purchase (behind their home), the business is heavily reliant on a favorable macro backdrop in order to prosper. Consumers can delay buying a new car when times get tough.

Yes, the economy spends more time growing than contracting, but it's concerning how much changes in interest rates can impact Ford's financials. If the U.S. enters a recession in the near term, it will certainly hurt the business. The fact that no one can accurately predict what direction the economy is headed in adds uncertainty and risk.

I'm also not a fan of Ford's growth trends. Revenue in 2023 was 20% higher than 2013's total. That translates to a compound annual rate of just 1.8%. Given the mature nature of the industry, there's no reason to have confidence that things will pick up from this pace.

Ford hasn't been a worthwhile investment in the past. I think this will continue to be the case, so I'm not buying the stock.