Mohacsy's Safe Portfolio Member Forum

[trkyhntr]

Interesting article on Yahoo (for the record, I don't think much of Yahoo).

Wall Street has lost its mind when it comes to Ford

• Ford booked a record profit in 2016, yet its shares are down 30% over three years.
• Tesla has passed Ford in market cap.
• Investor pressure on the carmaker is cranking up.
Consider this scenario: Your two biggest competitors for a century both have to be bailed out by the government, then go bankrupt. You borrow over $60 billion when you see trouble coming and can ride out a once-in-a-generation crisis.
You then enter a sustained sales boom for your most profitable products. Quarter after quarter, you make money and bolster your balance sheet. You invest in new opportunities, and you improve your position in foreign markets that historically have been weak.
As a public company, you are rewarded with a declining stock price, and you have to watch as an upstart competitor that has almost never made money in 13 years of existence and sells in a year the number of cars you sell in a month pass your market cap by almost $10 billion.
You could sit back and say Wall Street has lost its mind, and you'd be justified.
This is the position Ford now finds itself in. The company survived the financial crisis and has prospered during a US sales surge that favors the carmaker's big pickups and SUVs. CEO Mark Fields and Chairman Bill Ford have pushed to transform the company into a provider of mobility, strategically hedging it against a major disruption of the traditional auto industry.
The stock is down 30% over the past three years — and new sales records in the US were set in 2015 and 2016.


https://finance.yahoo.com/news/wall-street-lost-mind-comes-154612311.html