Ford anybody?

[kent]

I woke up to a disaster in the making this morning with my Ford holdings. After contemplating my belly button, having another cup of coffee and cleaning out my waterfall, I decided to jump on the lower price ($16.6785). Right now it's at $16.57 - am I great at this stuff, or what.

So, have I made an error or does anyone else think it was a good move?

[kman]

You only made an error if you feel the stock will not be worth $30 in a couple of years. Go long and be calm.

[kent]

Jan 28, 2011 13:10:59 GMT -5 kman said:

You only made an error if you feel the stock will not be worth $30 in a couple of years. Go long and be calm.

Thanks kman. I'm in it for more than just a few months so I'm feeling relatively comfortable even though I'm approaching the dreaded mandatory withdrawal stage.

[rovo]

At the end of Q3 Ford still had a negative book value per share.
Assets of $177,078 M
Liabilities of $178,851 M
Although I do not have access to the latest balance sheet, it was announced this morning they now have a positive book value. This may not sound very impressive but the ramifications of negative or positive book value are huge. It is my understanding this allows the company stock to obtain a much better rating. The rating on the stock defines whether or not the stock can be purchased by certain investor houses, primarily the pension funds. If and when their rating improves to "investment grade" we could expect to see some share price improvement as pension funds begin to buy Ford shares.

Maybe Frank the Impaler can offer some more insight on this item when he gets a chance.

Disclosure: I'm holding Ford stock.

[kent]

Jan 28, 2011 13:35:33 GMT -5 rovo said:

At the end of Q3 Ford still had a negative book value per share.
Assets of $177,078 M
Liabilities of $178,851 M
Although I do not have access to the latest balance sheet, it was announced this morning they now have a positive book value. This may not sound very impressive but the ramifications of negative or positive book value are huge. It is my understanding this allows the company stock to obtain a much better rating. The rating on the stock defines whether or not the stock can be purchased by certain investor houses, primarily the pension funds. If and when their rating improves to "investment grade" we could expect to see some share price improvement as pension funds begin to buy Ford shares.

Maybe Frank the Impaler can offer some more insight on this item when he gets a chance.

Disclosure: I'm holding Ford stock.

Thanks rovo!

[rovo]

From Ford's 8K released today:

Ford made significant progress in strengthening its balance sheet, reducing Automotive debt by $14.5 billion in 2010, a 43 percent reduction. These actions will lower annualized interest expense by more than $1 billion. Ford finished the year with Automotive gross cash exceeding debt by $1.4 billion. Fourth quarter actions reduced Automotive debt by $7.3 billion, including $2.5 billion of newly announced debt reductions to pay down Ford ’ s revolving credit facility and term loans.