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Investing in Ford

In: Business and Management

Submitted By naimkhan
Words 1549
Pages 7
Investing in Ford
MGT/521
August 18, 2011
Abstract

Choosing the right company to invest, where our money is not only safe, but also multiplies, is one of the toughest challenges for an investor. The potential benefits should outweigh the risks involved. The following is an attempt to put the pros and cons in perspective on why “Ford” is a good choice for a discerning investor.
Investing in Ford
Ford is an American multinational auto company head quartered in Dearborn, Michigan, that was founded in 1903. Fortune favors the brave. Fortune 500 has placed Ford in the tenth position in the list of the largest American corporations (CNN Money, 2011). A net income of $383 million was reported in the second quarter of 2011, with a pre-tax income of $604 million. (Ford Media, July). But the numbers themselves do not mean much unless there is a comparison with the size of the company.
To understand the progress made by Ford, we need to examine the stock price – Today, Ford closed at $11.11 (Yahoo! Finance, August). This figure may not look competitive, when seen in isolation. But when compared to how things were four years back, the progress in phenomenal. In 2008, the shares were as low as $1.01. When placed in this perspective, this is a giant leap for this automobile empire. These statistics show that there has been significant revamping done. In 2010, the company posted its highest net income in more than ten years, the full year net income being $6.6 billion, or $1.66 per share, which is an increase of $3.8 billion, or 80 cents per share, from 2009. (Ford Motor Company, 2011).
The reasons for Ford’s success today are mainly due to the extraordinary efforts of the Chief Executive Officer Alan Mulally. His leadership has taken this company to new heights that it has never reached before. Here is a SWOTT analysis of Ford.
Strengths
1) Leadership :...

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