When to buy Ford?

[stephenson]

Looking at fundamentals, I can't see why Ford is getting beaten up so badly ... isn't the dividend pretty tempting?

 

[Meadbh]

Could it be something to do with NAFTA negotiations, auto parts, risk to an integrated market?

Don’t shoot the messenger please!

 

[LOL!]

I think the fundamental story on automobiles and other vehicles is that people need fewer of them going forward. It is no longer a growth industry.

 

[Bamaman]

Ford has a long history undervalued stock prices. Prices have been a roller coaster since I went to work there in 1972. I long ago sold my Ford stock when the price topped out.

The auto business is the poster child for cyclible businesses that are extremely capital intensive. When things get good and profitable, profits would be sunk into the next generation of automobiles and trucks.

What was different about this company is The Ford Family had/has huge amounts of voting stock (and control) even though they don't own own that much Ford common stock. The Family and Wall Street just never had the best of relationships.

 

[97guns]

I just dumped my 1000 shares at $12.60, I heard there was a beat down coming after this last earnings report and that going forward it’s not looking great

 

[bobandsherry]

In my opinion, never. This company has failed to deliver value to the shareholder for years. Any good news is offset with future bad news. This dog has under performed GM by a mile, and Fiat/Chrysler has pounded them big time due to growth. This company lacks meaningful vision and the stock performance reflects that. Nothing changed with new management as it's still has Ford family oversight. $8 is likely price on this pig.

 

[Texas Proud]

I was thinking of when to buy a car, not the stock... and I would also say never... I had Ford products... they have always been bad to me.... always...

Because of this I would never buy the stock... maybe there has been a split or something (just checked, there has been)... but back in the '80s one of my employees kept talking how F was going up and up... that was back when it was selling about $9.... it is now just under $11.... not a great growth over that long of period...

 

[bobandsherry]

I was thinking of when to buy a car, not the stock... and I would also say never... I had Ford products... they have always been bad to me.... always...

Because of this I would never buy the stock... maybe there has been a split or something (just checked, there has been)... but back in the '80s one of my employees kept talking how F was going up and up... that was back when it was selling about $9.... it is now just under $11.... not a great growth over that long of period...

Nope, no split - this pig was $9 in 80's. Skyrocketed to almost $38 in 1999, then the boom! Only ones who still value this pig are those who managed to buy it for $1.45 in 2008. Was up to $19 in 2011 and under $11 today, what a dog. Only benefit is dividend paid out of 5.5% currently.

 

[NYEXPAT]

From what I understand, my wife bought several thousand shares today at $10.75 to get that 6.85% divy. At 36 she has a looong time horizon and they will likely be selling flying cars by the time she sells!

 

[brokrken]

In my opinion, never. This company has failed to deliver value to the shareholder for years. Any good news is offset with future bad news. This dog has under performed GM by a mile, and Fiat/Chrysler has pounded them big time due to growth. This company lacks meaningful vision and the stock performance reflects that. Nothing changed with new management as it's still has Ford family oversight. $8 is likely price on this pig.

Not sure I agree with this. Ford didn't go bankrupt while GM and Chrysler did.

 

[Blueskies123]

Auto production through out the world will plummet between electric cars and self driving UBER cars. The only people that will be buying cars in 10-15 years will be the very rich or people in very rural areas. Kind of like the people who own horses today vs who had horses in 1800's.
I am thinking about shorting the whole complex in about 5 years.

 

[bobandsherry]

Not sure I agree with this. Ford didn't go bankrupt while GM and Chrysler did.

Yes, I wasn't looking at the lifetime of the stock, but the last few years, comparing the last 2 years for GM and Fiat/Chrysler to Ford's performance. The strength of Ford to weather the time when GM and Chrysler when BK gave me confidence that this company could do well, they have proven me wrong.

In the past 2 years, despite a strong Bull market with S&P up 45%, Ford has gone from $11.50 and closed today at $10.71, down 80 cents or 7%! In that same time period GM up almost 50%, Fiat/Chrysler up nearly 250%. We can all talk about lower demand for cars impacting Ford, but GM and F/C have done well in the same time and same market of buyers. Ford's ticker of "F" is fitting for this POS.

 

[bobandsherry]

From what I understand, my wife bought several thousand shares today at $10.75 to get that 6.85% divy. At 36 she has a looong time horizon and they will likely be selling flying cars by the time she sells!

Um, how'd ya calculate 6.85%? 15 cent quarterly dividend is 5.6%.

 

[OldShooter]

Looking at fundamentals, I can't see why Ford is getting beaten up so badly ... isn't the dividend pretty tempting?

Gene Fama would off the efficient market hypothesis to you and in general I believe it is correct over the long run: https://www.investopedia.com/terms/e/efficientmarkethypothesis.asp

There may be emotional factors affecting the value of the stock, but I think the right expectation is that its future behavior will be random. That is, it will be affected by random and unpredictable future events and emotions. (Predictable events and emotions are already reflected in the stock price.)

Hence, it doesn't matter when you buy just as it doesn't matter exactly when you throw the dice at the craps table. I wish you luck.

 

[bobandsherry]

Auto production through out the world will plummet between electric cars and self driving UBER cars. The only people that will be buying cars in 10-15 years will be the very rich or people in very rural areas. Kind of like the people who own horses today vs who had horses in 1800's.
I am thinking about shorting the whole complex in about 5 years.

10-15 years is a lifetime - in that time we'll all be in flying cars. Just as much of a chance of that happening as seeing self driving cars. Do you honestly see self driving cars replacing people's personal vehicles? No way. People have for decades had access to just call a car, it's called a taxi. Uber only changes the dynamics on pricing/rates. Self driving may help to lower the cost further, but won't have people abandoning the want and need for personal car. People don't want to wait for a car to show up. People still need to travel more than 10-20 miles at a time. At best, maybe people who have more than one car can do with fewer cars, but I don't see cars going away.

Perhaps electric cars will be mainstream, but it's still a car with only the power plant replaced, someone still needs to build them.

 

[target2019]

Auto stocks are cyclical, and down cycle is front and center. F has been trading in a band, and don't expect to make much on it with growth. The dividend has been nice, but I'd wait for $10 a share. Too much uncertainty, and just downside in the future.

 

[bobandsherry]

Auto stocks are cyclical, and down cycle is front and center. F has been trading in a band, and don't expect to make much on it with growth. The dividend has been nice, but I'd wait for $10 a share. Too much uncertainty, and just downside in the future.

Don't care about cyclical nature, or rather greatly discount that for a long term investment. When Ford drops over past 3 years and GM and Fiat/Chrysler go up that's not due to cyclical sales. Instead it highlights how poor Ford stock is for an investment. Management does exude much confidence either.

 

[Winemaker]

Um, how'd ya calculate 6.85%? 15 cent quarterly dividend is 5.6%.

I just bought some F the other day in my mad money account. Ford has also paid a special dividend the last few years, juicing that %.

 

[bobandsherry]

I just bought some F the other day in my mad money account. Ford has also paid a special dividend the last few years, juicing that %.

Can't count on that every year, they paid for last 3 years a little bump, but prior to that went many years without it at least up to 2006 after they cut dividend to a nickle/qtr. Supplemental was a whole nickle last year.

 

[Blueskies123]

At best, maybe people who have more than one car can do with fewer cars, but I don't see cars going away.

Perhaps electric cars will be mainstream, but it's still a car with only the power plant replaced, someone still needs to build them.

I did not say cars will go away, I said car production will go down and eventually plummet in 10-15 years. Do you still get a newspaper? My neighbor still gets one and said they will never go away but how have those newspaper stocks done the last 5 years. I think newspapers are a good analogy. As production slows and then starts to decline, gradually at first, what will happen to those stocks? You can certainly buy Ford and maybe even make money as they try to maintain and maybe increase the dividend but the writing is on the wall.
This is what car production will look like in your life time. Yes, there will still be some car production, but how many. Just do not buy and hold.
http://www.cowboyway.com/images/HorsePopulation01.png

 

[Al18]

I've done well investing in Ford over the years. I bought some in 2008 for $2, and have sold and bought some since. They weathered the 2008 dip without needing a bailout and they've been paying a good dividend since 2012. I'm thinking about buying more.
There are few good deals on stocks these days, but I think Ford is one of them.

 

[stephenson]

Great discussion - just what I hoped for.

I bought another 500 shares yesterday - not so much for the likely increase, but more of a play for the dividend.

I have had several Ford vehicles over the last few years - two of the new Taurus models, two Explorers and a Sport Trac ... lots of buddies with F150s/250s. My experiences have been better than very good - a few bad stories from my buddies but in general about the same as GM, etc. And, to be clear - WAAAAY better than what my MB and BMW friends says about their reliability issues.

Didn't want to sound so much like a commercial ... sorry ...

Will be watching on Monday

 

[Winemaker]

I bought their stock for the dividend play and for slow appreciation; I appreciate the fact they didn't take a bailout. That being said..... I can't stand their cars or trucks.

That being said, I've always bought GM cars, I currently have 3. However, I did buy their stock in 2006 and got wiped out. If I buy another vehicle, it will be another GM product, but I don't buy new.

 

[Cortina]

I have recently bought some - at $10.35 .... thought the dividend was worth getting , vs having "cash" sitting about. Not expecting any big movements in either direction in the short term .... famous last words ! (Did NOT make a large investment ... would consider buying some more if it goes to single figures ?)

 

[Meadbh]

I have recently bought some - at $10.35 .... thought the dividend was worth getting , vs having "cash" sitting about. Not expecting any big movements in either direction in the short term .... famous last words ! (Did NOT make a large investment ... would consider buying some more if it goes to single figures ?)

I’m curious whether you owned a Ford Cortina at one time?

https://en.m.wikipedia.org/wiki/Ford_Cortina