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F STOCK WRITE UP

F(FORD)

  • P/E: 10.9
  • GAAP DILUTED EPS Y-O-Y GROWTH LAST QUARTER: -$.67
  • SECTOR: CONSUMER DURABLES
  • ASSETS-LIABILITIES: 1.21
  • DIVIDEND: 4.79%

Ford is a well-known brand, largely due to its successful models such as its F-series trucks, and its position as the 2nd-best selling automobile maker in the US, according to Statista. The stock has fallen steadily since its high of $17.5 in 7/2014. While backed by some solid technical facts as a function of its proven products, the company lacks growth in recent years, which has led to its stock dropping in value.
According to the website Statista, Ford is slightly behind GM in total revenue, and markedly behind Volkswagen, the leading automotive manufacturer. Ford reported its own global market share was down 1/10th of a percentage point from the prior year. However, Ford does possess a consistently best-selling brand in its F-series truck, the best-selling in its category over the past 40 years. Additionally, Ford produces the 4th most sold electronic vehicle in its electric version of the Fusion. Therefore, Ford is innovating while retaining its principle business foundation.
Ford reported a record operating margin in its most recent quarter, although its year-over-year profit was down, largely due to a pension adjustment of $3 billion. The company reported its only record profits in its European business sector. While this is not poor business performance, it certainly does not represent phenomenal growth in every facet of its operations.
The company has a solid ratio of assets-liabilities at 1.21, showing that it is not overspending in order to develop its business, and their operating margins are increasing steadily. Unfortunately, Ford is regressing in EPS with its low spending and reliance on its foundation products, and its price-to-earnings multiple, while attractive in appearance, is a function of its lack of growth. A solid dividend and a conservative guidance creates the opportunity for the company to provide steady yield and possibly an increase in future share price due to surprising analysts by beating their own conservative guidance.







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