Why Jim Cramer Is Telling Investors To Buy Ford Stock Ahead Of Earnings

Investors should buy Ford Motor Company (NYSE: F) ahead of its earnings report, Jim Cramer said Tuesday on CNBC's "Squawk On The Street."

Ford had a very big run in May before pulling back significantly, Cramer said. The stock shouldn't have sold off from its highs, he added.

Cramer told CNBC that he expects Ford to report better-than-expected earnings results next week.

When Taiwan Semiconductor Manufacturing Co Ltd (NYSE: TSM) reported financial results, the company proved that the chip shortage is not as tight as many people thought, Cramer noted. 

Furthermore, he expects Ford CEO Jim Farley to talk about the Ford Mustang Mach-E on the conference call. The vehicle's incredible sales and great customer satisfaction make it the "first actual rival" to Tesla Inc (NASDAQ: TSLA), he said. 

"I am saying buy Ford," Cramer emphasized.

Ford is set to report its second-quarter financial results on July 28.

Related Link: Understanding Ford Motor's Unusual Options Activity

F Price Action: Ford has traded as high as $16.45 and as low as $6.41 over a 52-week period.

At last check Tuesday, the stock was up 4.25% at $13.85.

Photo: Courtesy of Ford.