Stock Alert for Ford Motor Company ($F)

Ford Motor Company (NYSE: $F)

Ford Motor Company (F) designs, develops, manufactures and services automobiles and trucks globally.  The Company operates two sectors, Automotive and Financial Services.  The Automotive sector markets and sells Ford, Mercury, Lincoln and Volvo brands.  The Financial Services sector offers financing to dealers and consumers of Ford vehicles.

Founded in 1903, the Company is headquartered in Dearborn, Michigan.

Share Statistics (20-Apr-10)			FY 2008	FY 2009	% Chg	Q4 2008	Q4 2009	% Chg
Symbol	F	Revenue, $Mn	145,114	118,308	-18.47%	28974	35449	22.35%
Current price	$13.91	Gross marg.	7.08%	10.97%	26.40%	1.28%	10.57%	910%
52wk Range:	$3.27- 14.54	Oper. margin	-10.40%	-2.39%	-81.29%	-17.18%	2.13%	-115%
Avg Vol (3m):	114,378,000	Net margin	-10.18%	2.30%	-118%	-20.63%	2.50%	-115%
Market Cap.	46.85B
Dil. Shares Outst.	2,636M	EPS, $	-6.500	1.694	-126%	-2.540	0.817	-132%

Source: Reuters.com, SEC Filings.

Financial Strength

Financial Strength (20-Apr-2010)	Company	Industry	Sector	S&P 500
Quick Ratio (MRQ)	–	0.37	0.67	0.81
Current Ratio (MRQ)	–	0.44	0.83	0.96
Long-Term Debt to Equity (MRQ)	–	23.97	27.42	155.11
Total Debt to Equity (MRQ)	–	43.18	44.74	220.99

Source: Reuters.com, SEC Filings.

Analyst Consensus

The mean of 16 analysts rate shares of F an “Outperform.”

Analyst Recommendations and Revisions

1-5 Linear Scale	Current	1 Month Ago	2 Month Ago	3 Month Ago
(1) BUY	6	6	6	6
(2) OUTPERFORM	2	3	3	3
(3) HOLD	5	5	5	5
(4) UNDERPERFORM	1	1	1	1
(5) SELL	2	2	2	1
No Opinion	0	0	0	0
Mean Rating	2.44	2.41	2.41	2.25

Source: Reuters.com, SEC Filings.

Investment Highlights

The Company has been severely affected by the synchronous global downturn stemming from a collapse of consumer and corporate credit as well as declining assets values in both the housing in equities markets, becoming most evident during the fourth quarter of 2008.

While the economic outlook remains uncertain, slow steady growth from a very low level is the consensus forecast among economists.  Consumer and commercial credit, labor markets in many countries and the lack of real income gains continue to suppress consumer and meaningful business spending.  Moreover, the direction of central banking and government policies regarding the housing and automobile market, taxes and further stimulus programs in the United States, Europe and the United Kingdom is murky.

Estimates of approximately 64.3 million units were sold during 2009, a decline of four million units or 6% from 2008 levels.  The Company projects an increase in vehicle sales to reach between 65 million units and 75 million units globally in 2010.

In 2009, global production capacity of light vehicles reached 86 million units, far exceeding vehicle demand by approximately 29 million units, according to automotive research firm CSM Worldwide.  Estimates of overcapacity in the two most profitable regions, North America and Europe, were 96% and 37%, respectively.  CSM Worldwide projects global excess capacity of an average of 21 million units could continue through 2014.

Downward pricing pressure due to overcapacity could intensify in coming years as Japanese and Korean manufacturers continue to wrestle for market share in the North American and European markets.  Real price contraction in the U.S. vehicle market since the late 1990s is most likely to continue during this decade.

Muted consumer credit, real income growth and spending remain a difficult challenge, severely affecting the trend away from purchases of larger, higher-margin, richer-features vehicles in recent years.  Real income in the United States and Europe has stagnated during the last decade, providing one of several catalysts for the preference for an increase in demand for consumer credit during the same period.

The current contraction in consumer borrowing is likely to continue in the short term as expectations for a rebound in employment in the United States and Europe is low.  Longer term, industry revenue will depend on the ability of consumers to obtain credit and experience real per capita income growth.

Contrasting the formidable headwinds facing U.S. and European consumers, Asian consumers are expected to achieve higher standards of living and real per capita income gains.  Increase revenue generated from the Asian market is expected to offset downward pressure in revenue projected from the U.S. and European markets.  The Company expects major automobile and truck manufacturers to dominate global markets in the coming years.

Uncertainty in the energy and other commodities markets remain an important factor in the forecast of global vehicle sales.  High crude and other commodities affect the industry’s ability to limit price increases, as higher commodities prices compete for shrinking household disposable income.  As the world economy expands, upward pressure on commodities prices is expected to continue weighing on consumer spending and vehicle sales.

Higher trending prices of gasoline and diesel as well as increasing environmental regulation are anticipated to increase demand for more fuel-efficient vehicles.

Technical Analysis

Source: http://stockcharts.com/h-sc/ui?s=F

F is trading above its 13-day moving average. This is considered to be the sign of a bullish trend. There is more weight to this indication because the moving average is ascending and suggests that there has been buying interest in this stock.

F’s recent volatility has been less than normal since early March. This is evidenced by the decreased distance between the upper and lower Bollinger Bands. These bands measure volatility using standard deviation and a smaller width is due to lower volatility.  Additionally, F is trading above its mean Bollinger Band.

The MACD for F currently indicates a bullish signal for two reasons. First, the MACD is above the signal line, a 9-day moving average.  Second, the MACD is above 0, which implies that the underlying moving averages are trending higher.

Comparative Analysis

Company Name	Ticker	Price/	Mrkt. Cap.	P/E		P/S
Apr-20-2010	symbol	Share, $	$ Mn	2009	2010	2009	2010
Toyota Motor Corp.	TM	78.76	124	n/a	69.09	0.66	n/a
Honda Motors Co.	HMC	34.60	62,790	356.7	18.02	0.72	n/a
Daimler AG	DAI	52.37	53,630	n/a	12.71	n/a	n/a
Auto Manufacturers  Median				15.74	n/a	0.74	n/a
Ford Motor Company	F	13.91	46,850	16.10	9.87	0.39	n/a

Source: Thomson Financial

Insider Trading Activity

NET SHARES PURCHASE ACTIVITY Inside Purchases – Last 6 Months
	Shares	Transaction
Purchases	n/a	0
Sales	1,518,900	10
Net Shares Purchased (Sold)	(1,518,900)	10
Total Insider Shares Held	120.65M	n/a
% Net Shares Purchased (Sold)	(1.2%)	n/a

Net Institutional Purchases – Prior Qtr to Latest Qtr
	Shares
Net Shares Purchased (Sold)	371,648,000
% Change in Institutional Shares Held	15.00%

Source: Yahoo Finance

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