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Ever since the Federal Reserve announced QE3, the stock market has staged a strong rally and many indexes now trade at about 5 year highs. A big rally in the stock market means it is harder to find deep value bargains, but the weak economy and ongoing debt crisis in Europe is creating select opportunities to buy undervalued shares of companies like Ford (NYSE:F).

While fears over Europe might seem like it makes sense to stay away from stocks with European exposure, that could be a mistake. While there has been plenty of bad news and reasons to stay away from European stocks, investors who went contrarian and bought stocks in Europe actually had a great quarter, as European stocks rallied sharply in the face of bad headlines, over the past several weeks. For example, in spite of many negative headlines and worries in Europe, the Euro Stoxx 50 Index (NYSEARCA:FEZ) just enjoyed the best quarterly rally in 3 years. Here are a few reasons why investors should put aside the well-known negatives and focus on the long-term positives that Ford shares offer investors:

1. Europe is a drag on profits but that issue is very well-known and possibly already completely factored in. Besides, auto sales remain strong in the United States. On October 9, Autonation, Inc. (NYSE:AN) announced that car sales rose about 23% in September, as it saw higher sales in all segments.

2. Ford has an extremely capable management team that is led by CEO, Alan Mulally. He has served as President and CEO of Boeing Commercial Airplanes, and has also received numerous management and leadership awards over the years. He also has led Ford though many challenges and has seen the company make progress on a number of fronts, including car design, fuel efficiency improvements, a strengthening balance sheet, and the initiation of a dividend, amongst other positives.

3. Ford could become a dividend growth stock. Earlier this year, Ford announced it would start to pay an annual dividend of 20 cents per share. With the stock at just $10, this provides a yield of 2%, which is impressive since General Motors (NYSE:GM) does not offer any dividend. Also, it is important to realize that since Ford is expected to earn about $1.50 per share, the dividend of 20 cents means there is plenty of room for future increases.

4. Ford appears to have some advantages over General Motors. It has less exposure to the economy in Europe and China when compared to General Motors. In fact, China is one of GM's biggest markets and that country is seeing a slow down. General Motors owns the Opel brand which is well-known in Europe, but historically it has been a big drag on earnings. Ford also does not have government ownership exposure that GM has due to the bailout made years ago.

5. Ford shares trade for just about 6 times 2013 earnings estimates, while the average stock in the S&P 500 Index trades for about 15 times earnings. That means there is plenty of room for multiple expansion with Ford shares.

All the factors above could help to contribute to Ford's upside potential. Analysts at Morgan Stanley (NYSE:MS) recently reiterated an overweight rating and set a $17 price target for Ford. At this level, the shares would still be trading for a very reasonable 11 times 2013 earnings.

Key Data Points For Ford From Yahoo Finance:
Current Share Price: $10.07
52-Week Range: $8.82 to $13.05
Dividend: 20 cents per share which yields 2%
2012 Earnings Estimate: $1.25 per share
2013 Earnings Estimate: $1.48 per share

Key Data Points For General Motors From Yahoo Finance:
Current Share Price: $24.30
52-Week Range: $18.72 to $27.68
Dividend: none
2012 Earnings Estimate: $3.12 per share
2013 Earnings Estimate: $3.91 per share

Data is sourced from Yahoo Finance. No guarantees or representations are made. Please consult a financial advisor before making investments.

Source: 5 Reasons Why Ford Shares Could Rise 70%