This Is the No. 1 Ultra-High-Yield Dividend Stock Held by Retail Investors on Robinhood — and It’s Not Even Close

For well over a century, Wall Street has served as a surefire moneymaker for optimists and those with a long-term mindset. But the stock market’s list of winners includes more than just institutional investors and billionaire money managers.

Since the advent and proliferation of the internet in the mid-1990s, retail investors have been playing an increasingly larger role on Wall Street. According to “The Retail Investor Report,” which was published in 2023 by the University of Missouri-Kansas City’s School of Law, everyday investors accounted for 25% of equities trading volume in 2021, which was almost double the percentage they accounted for a decade prior.

As retail investors have become a foundational aspect of the stock market, online brokerages have angled their platforms to cater to these investors. This includes Robinhood Markets, whose online platform (Robinhood) has resonated with everyday investors. Offering commission-free trades on major U.S. exchanges and the ability to buy fractional shares has made Robinhood especially popular.

Image source: Getty Images.

But perhaps the greatest aspect of Robinhood’s investment platform is the data it’s willing to share. Robinhood’s “100 Most Popular” leaderboard lists the 100 most-held securities (stocks and exchange-traded funds, or ETFs) on the platform. Recently, electric-vehicle (EV) maker Tesla topped Nvidia to become the most-held stock on Robinhood.

While growth stocks and diversified ETFs tend to dominate the top holdings on the 100 Most Popular leaderboard, one stock stands out as an anomaly. It’s the only ultra-high-yield dividend stock — “ultra-high-yield” in the sense that it’s yield is four or more times greater than the average yield of the S&P 500 — in the top 25 holdings. Say hello to retail investors’ favorite supercharged income stock on Robinhood… Ford Motor Company (F 1.20%).

Retail investors are stomping the accelerator on Ford for a variety of reasons

As of the closing bell on July 8, Ford was the seventh most-held security on Robinhood, trailing only aforementioned rival Tesla, along with Apple, Nvidia, Amazon, Microsoft, and the most-held ETF, the Vanguard S&P 500 ETF. The next-closest ultra-high-yield stock on the leaderboard is Pfizer, which is the 27th most-held security by retail investors.

One reason everyday investors can be excited about Ford is its historical consistency. Despite automakers ebbing-and-flowing with the health of the U.S. and global economy, few things have stood the test of time quite like Ford’s F-Series trucks. The F-Series has been the best-selling truck in the U.S. for 48 consecutive years (through 2024), and the top-selling vehicle of any kind in the U.S. for 43 straight years.

In the business world, bigger isn’t always better. But when it comes to selling vehicles, bigger often leads to higher vehicle margins. Ford’s ability to consistently sell more trucks than its competition is fantastic news for its vehicle margin and bottom line.

Retail investors also appreciate Ford’s nimbleness with its capital expenditures. While EVs have been largely viewed as a no-brainer long-term growth opportunity, EV demand has tapered in recent years, with the infrastructure not yet in place to support a ramp up in all-electric transportation.

Despite committing up to $50 billion in EV investments through 2026, Ford announced in October 2023 that it would delay up to $12 billion in EV spending until capacity necessitates additional investment. Even though Ford’s EV segment is currently a drag on its bottom line, having the ability to pull this proverbial handbrake should buoy its cash flow and ensure EV losses don’t worsen.

Another factor potentially responsible for making Ford a top-seven holding on Robinhood is CEO Jim Farley’s efforts to improve his company’s production quality. Ford has struggled with higher warranty-related costs since Farley took the reins from former CEO Jim Hackett on Oct. 1, 2020. Thankfully, J.D. Power’s 2025 U.S. Initial Quality Study rankings show Ford has been inching its way up the list among other brands — it ranked 14th out of the 33 brands in the latest study. While there’s still work to be done, Ford’s higher warranty expenses should taper in the coming years.

Lastly, everyday investors are probably intrigued by Ford’s inexpensive forward price-to-earnings (P/E) ratio amid a historically expensive stock market. Shares of Ford can be scooped up right now for about 8 times forecast earnings in 2026. In comparison, the S&P 500’s Shiller P/E Ratio is effectively at its third-highest multiple during a continuous bull market when back-tested 154 years.

When a forward P/E of around 8 is coupled with a 5.14% dividend yield, you get retail investors’ favorite ultra-high-yield dividend stock on Robinhood.

Ford’s F-Series trucks (2023 Ford F-350 Super Duty pictured) have been the top-selling vehicle in the U.S. for 43 consecutive years. Image source: Ford.

Ford stock is (temporarily) in the slow lane for a reason

However, Ford stock is down 21% over the trailing decade, not including dividends, which represents a 220-percentage-point underperformance of the broad-based S&P 500. There are well-defined reasons for Ford to the be in the proverbial slow lane, and it may not buck these headwinds anytime soon.

The most obvious of these headwinds is President Donald Trump’s tariff and trade policy. In late April, the president implemented tariffs on most imported automobiles, which he proclaimed won’t be going away. These tariffs run the risk of reigniting inflation domestically and worsening sales of American vehicles in foreign markets. It’s also worth pointing out that the Trump administration’s messaging on tariffs has been consistently inconsistent… and Wall Street values predictability above all else.

Another concern for Ford investors is the potential for the U.S. economy to dip into a recession. Despite the probability of a U.S. recession declining in recent months, economic downturns, while short-lived, are normal, healthy, and inevitable. Auto stocks are highly cyclical and effectively tied at the hip to the U.S. economy. If consumers begin to worry about their jobs and/or near-term economic growth, it may lead to new vehicle purchases being pushed further down the road.

It’s also not clear when the EV revolution is going to work in Ford’s favor. Though it seems inevitable that Ford’s Model e division (this is its all-EV operating segment) will be a long-term growth driver, there’s uncertainty as to when EV infrastructure will be sufficient to drive mainstream EV adoption across the country.

An argument can also be made that Ford isn’t as historically cheap as it’s been in the past. While its forward P/E of a little over 8 is considerably lower than the average forward P/E of S&P 500 companies, it represents a 13% premium to its average forward P/E multiple over the trailing-five-year period.

Though Ford stock makes for an intriguing investment when looking three, five, or 10 years out, it could struggle to gain traction at its current valuation in the coming quarters given these aforementioned headwinds.