11:46 AM EDT, 10/29/2024 (MT Newswires) -- Ford Motor's ( F ) excessive inventory, competitive price pressure and increased costs are expected to prompt downward revisions to 2025 consensus expectations, Morgan Stanley said in a report Tuesday.

The automaker's full-year 2025 consensus estimates "will likely continue to fall," as the company will have to "show more progress on factors within its control - specifically inventory reduction and cost improvement," the investment firm said.

Ford told analysts during an earnings call that it is intentionally holding extra inventory through the year's end to protect sales during the early 2025 launch of Expedition and Navigator variants, according to Morgan Stanley.

The carmaker also expects lower industry pricing to act as a headwind to EBIT, the firm said. The carmaker said late Monday it now expects full-year consolidated adjusted EBIT to be about $10 billion, at the low end of its prior guidance of $10 billion to $12 billion.

"While we believe Ford may be under-earning vs. some of its peers and has significant self-help potential, the market will not reward the company's earnings multiple until the negative revisions can begin to subside," the firm said.

Morgan Stanley has an equal weight rating on the stock and a $12 price target.

Ford shares were down more than 8% in recent trading.

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