Ford – Value Play?
- 6 Comment
I have to admit, when I see what has happened to the share price of a stock like Ford (F), I start to take a bit of notice. Although I do not follow the auto industry very closely, it has been pretty hard not to notice all the crap that Ford has been going through. In the past week alone, they have announced that they will be cutting some 14,000 jobs, closing plants, and most importantly to me, cutting its dividend.
That last move simply makes me want to stay far away. It is not like they simply did not choose to raise the dividend, they are STOPPING the payment of their dividend. When one reads between the lines on this, there is simply not enough earnings being generated to warrant a dividend payment and that is trouble. And no earnings means poor share performance in my mind. I am not going to dip, no matter how low it goes
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6 Comments on this post
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WITY said:
I absolutely agree about F. Best to stay away from any perspective. From a dividend investor’s point of view even more so.
But this makes me wonder – how do you reason being long GM, which seems to me to be in just about the same situation?
September 17th, 2006 at 7:32 am -
finance girl said:
Yah, I saw the same thing in this morning’s WSJ. Can you imagine having to be an employee in the Detroit Big 3 right now? Talk about depressing, not only is your company in crisis but your own holdings are tanking (e.g. Detriot area real estate, employer stock, etc.)
September 19th, 2006 at 10:06 am -
Tom said:
I live in Michigan and it seems like every company is being effected by these stupid automakers. Our economy is horrible and it’s very tough to find a job around here seeing every other job is manufacturing/automotive related. Michigan is in a lot of hurt for the next 5-10 years. That’s why I’m moving out this state.
September 19th, 2006 at 4:28 pm -
G said:
I would be will to take the risk, if you have a long time to sit on the stock. If this management plan works, it could mean big profits in the future for Ford.
September 20th, 2006 at 7:06 pm -
Alaska 49 said:
I took the risk…at 1,50 a share…had a free trade and a little extra cash sitting in my IRA…..and it has been my best investment to date.
January 1st, 2010 at 8:22 pm
[...] ford – value play? … closing plants, and most importantly to me, cutting its dividend. … raise the dividend, they are stopping the payment of their dividend. when one reads … there is simply not enough earnings being generated to warrant a dividend …Read more: here [...]