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Author: GeezerRob Big gold star, 5000 posts Old School Fool Home Fool Supernova Phoenix 1
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Subject: Re: FORD LOOKING GREAT! Date: 9/13/2006 4:34 PM
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"I'm sure you have reasons for your belief that Ford stock will continue to rise. How about you share them with us and add value?

Thanks."

"Rob, one of my reasons is that I believe in the
intrinsic value of the company."

When current pension, health and debt obligations are fully accounted, I doubt there is *any* intrinsic value left (ie no shareholder equity). I note that pensions and health care obligations are not fully accounted for (new standards have been proposed to address that by the way)....and I'm not sure about the debt.

If, on the other hand, you mean that you believe that Ford's *total* resources....including the ingenuity of it's employees....will pull the Company out of the toilet into the light of a brighter day...we'll see...I certainly can't affirm or deny your belief here with any absolute statements.

"Ford does not only
make cars but also other things."

Well, those other things are trucks.;) Besides trucks and cars, the only other products are *parts* for those trucks and cars. *That's it.* Ford even got rid of the junk yard business and the oil change business. Unless you count Ford Credit...which finances those cars and trucks, but does not finance houses, etc like GMAC does for GM.

"Ford always had
the technology to produce a better car"

Hmmmm....well, without straining at nits...Ford is doing the best it can right now. It will do better next month and better yet next year. Do they have the technology to build a "better car"? Well, yes, everybody can build something better than they do right this minute...everybody working on their next generation vehicles....but they will be available when they are ready. Could Ford deliver a better car than the Focus...today? Yeah, there are a bunch of better cars over at the Aston Martin dealership. My point is that Ford's current Focus (for example) is the best that Ford can do *today* with the given set of constraints (price, size, performance). A "better" version is coming...and it will be as good as it can be...and we'll sell it at a loss.

I would point out that there are *always* constraints....they form the definition of what you want to make. We're *working* on fixing costs so that they are less than prices...

"Ford is
a very well known brand the world over."

Very true. Part of the problem is what it's known for here in the U.S. (and in Europe). Putting that aside, the brand is the most valuable asset....which has been rapidly depreciating. Did you know that fewer than a quarter of vehicle buyers are even *willing* to *consider* a Ford Motor product? That makes it *real* hard to claw our way back!

*********
All Ford shareholders can be pleased with the recent increase in price.

Where will the price go from here? I wish I *knew*. I *suspect* that it will rise some with the accelerated Way Forward announcement...and may rise further when initial sales of the new Edge/MKX come in....but I think the price will tank as upcoming financial figures come out...note that I *didn't* say "profits". :(

My personal plan is to wait and see, but I suspect that I'll sell off 90% of my Ford holdings *after* November, but *before* 4thQ results come in. We'll see. I think we'll see $10, maybe $12....then I wouldn't be surprised if it dropped back into the $6 range for a while before that "brighter day."

And thanks for sharing *your* thinking, PHOINIX20.

Rob
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