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"Ford Motor Co. (NYSE: F) recently surprised Wall Street by posting its first profit in ages," notes Mark Skousen in The Turnaround Trader. Here's the advisor's bullish outlook on the auto maker.
"Ford announced a $100 million profit in the quarter, even though sales lagged General Motors and Toyota. I see Ford as a deeply undervalued company that finally is producing good quality cars, both here and abroad, and I don't think higher gasoline prices will have much effect on the turnaround.
"Ford must be seen as a global producer. And foreign sales are booming for Ford and GM. Moreover, now that Ford has decided to include Microsoft's Nuance-powered Sync voice control system in some of its 2008 models, it could help improve sales dramatically here in U.S. showrooms.
"If the profitable quarter continues, Ford now is selling for only 14 times next year's earnings. With revenues of close to $40 billion in the quarter, a smart business person certainly could cut the fat from that and turn a profit, and that is exactly what turnaround specialist CEO Alan Mulally is doing.
"Under his guidance, Ford saved $1.7 billion from cost reductions in the quarter and agreed to sell Jaguar and Land Rover. Wall Street likes what Mulally is doing, and so does billionaire investor Kirk Kerkorian, who is buying its stock. Let's join him by buying Ford."
Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.
There's also the bearish case: Ford (F): No short seller faith in turnaround
Reader Comments (Page 1 of 1)
1. I'm glad that people & the stock market are finally realizing that Ford is building a very good product. The have been for several years but really seem to have gotten it together now. Cars are finally getting as much attention as trucks & it shows. Like Toyota & Honda, they started with their small cars & are moving up though their product line. Congratulations Ford, keep it up!
Posted at 5:51PM on May 12th 2008 by Tony
2. Ford is coming back with innovation like SYNC, EcoBoost, Hybrid X-Overs. I used Sync on my friends car and was impressed by convenience. That is on top of a very modern and stylish design.
I was also amaized to find that Ford's quality is among the BEST in the industry matching Toyota and Honda.
It is our American Company which prooves again and again temendous reserves and talent of American people.
Let's give it a credit. My next car will be FORD!
Posted at 10:40PM on May 14th 2008 by Igor
3. I always love to read people taking credit for something they had nothing to do with.
"It is our American company which proves once again....."
Give me a break. What did YOU have to do with Ford's recent success? Are you also taking the blame for their earlier failures? No one seems to want to step up to those.
BTW, Eco-boost has been in production for several years now by others, without great increases in fuel economy.
Posted at 12:20PM on May 15th 2008 by jpdr1100