Seidman Investment Portfolio Organization

 

Winter 2012 Buy Summary:

Turner Novak - General Member

Ford is the second largest U.S. producer of light vehicles and consists of two operating departments; automotive and financing.


Strengths

  • Overall global demand for automobiles expected to rise over 2012
  • Reinstatement of quarterly dividend will provide long-term stable income
  • Effectively 0% interest rates reduces interest expense and encourages growth
  • Increasing its line of EcoBoost cars by 300% to meet a demand for fuel-efficient cars due to rising gasoline prices
  • Highest free cash ratio of all automakers at $1.76 per share
  • Only U.S. automaker to survive the financial crash without government assistance
  • Solid income growth and policy easing in emerging markets, coupled with improving U.S. fundamentals, are supportive of increasing industry sales; 2012 global industry sales projected to be about 80 million units

 

Weaknesses

  • The European debt crisis and overall European economy will affect European sales and most likely cause low sales in the short-term
  • The risk of a double-dip recession causes uncertainty on whether consumers will purchase new automobiles

Page last modified March 11, 2012