Ford Stock Hits Historic Low of $2.92

TMN · #1 (**permalink**) 10-07-2008, 04:17 PM

10-07-08: It has just been a house of cards for Ford Motor Company this week. Carried down with a 500 point DOW slide today, Ford stock (F) today hit an historic low of $2.92 a share at market close. It is a 23 year low as the stock hit $1.03 in 1981 or about $2.57 adjusted for inflation, so it has been lower than this before.

Regardless of previous precedent, this is a scary measure for Ford which enjoyed stock values of $35-37 a share in the late 1990’s and even $16 per share as recently as 2004. After hours trading today has been hovering around $2.99, so where it will go on Wednesday is anyone’s guess.

In addition to all the havoc in the stock market, some of Ford’s plummeting value of over 20% today was attributed to Fitch lowering their credit rating further into junk status. It is a bargain at this point to investors who are willing to gamble however. Financials blogs are full of posts this afternoon by investors pulling the trigger to buy up the sell off. Many feel that at today’s price of under $3.00 a share, there is much further to go up again than to fall.

History is 20/20 though. Gloom and doom is the talk of today. That $1.03 stock price in 1981 was at another bad time in our market cycle. Those who took advantage of that buy back then would have quadrupled their investment by 1984. Just a short time later in 1987, that stock was worth $15.76. Simple math tells you that $1000 invested in 1981 became worth $15,000 by 1987. So, all bad news has a silver lining if you are in the right place at the right time.

Mr Dayzee · #2 (**permalink**) 10-09-2008, 07:11 AM

Now is the time to get in for sure. And Wachovia stock would be a good one to buy as well.

chiefstang · #3 (**permalink**) 10-09-2008, 07:12 AM

And then on Wednesday it dropped to an official all time low: $2.10. Ouch. It rebounded later in the day, but that was by far the lowest FMC stock has ever been. It's official, these are our darkest hours. Put on your helmets. Realistically it's probibly a GREAT time to buy some shares.

TMN · #4 (**permalink**) 10-09-2008, 08:46 AM

We on the watch. It is hovering in the mid $2's today. Bought a small amount yesterday.

chiefstang · #5 (**permalink**) 10-09-2008, 03:08 PM

Closed at $2.08 on Thursday. Ouch! Wish I could buy some. Problem is, I sell Fords for a living, and I have no money.

07_427r · #6 (**permalink**) 10-09-2008, 03:41 PM

And I hear GM was put of some sort of credit watch today. Tough times ahead for domestic manufacturers. No telling how this will all end up.

TMN · #7 (**permalink**) 10-09-2008, 05:00 PM

Update 10-09-08:

10-09-08: For the third bloody day in a row, Ford (F) stock has fallen to a historic low. Closing today at an all time low of $2.08, it had fluctuated even lower during the day at $2.03. We are nearing “penny stock” status in this week of market turbulence that is getting close to harming the auto industry in ways that we have seen banks destroyed in the past couple of months. We hate to say it, but it appears this trend is only deepening.

General Motors (GM) has also been on the hell-bound ride to ruin this week hitting s historic low of $4.76 per share, a 31% drop in value today alone. To give a scary comparison on where things are right now, Mattel Inc. is worth almost $2 billion more than GM. Motorcycle maker Harley-Davidson Inc., with a market capitalization of $6.83 billion, is worth more than Ford.

Wall street fears that automakers are the next domino to fall in the economic crisis. This is in part because dealerships cannot get buyers financed to sell the vehicles. Many buyers now have damaged credit due to the housing mess and foreclosures. Those buyers who still have marketable credit are finding that the bar has been raised drastically on loan approvals.

Anecdotal news we are hearing is that a year ago, dealers were getting 80-85% of all loan applications approved to sell cars. Today that number is hovering around 20-25% approval rate. This plunge in buyer approvals is directly connected to a plunge in sales. The bad news is that there is no end in sight.

If a majority of buyers are not credit worthy today, it will take months if not years for them to become approvable again in a best case. That fact has Wall Street looking at automakers in a new light. This problem is not going away and may unfortunately get worse before it gets better.

07_427r · #8 (**permalink**) 10-09-2008, 05:32 PM

Not a good situation at all and no quick fixes either.

I fear one or more of the big three may end up in "B" if the government doesn't step in. I heard locally that creditors are looking for 750+ on your FICO score or the deal is off. That will remove many from the credit markets and car loans.

TMN · #9 (**permalink**) 10-09-2008, 05:45 PM

Quote:

Originally Posted by 07_427r

Not a good situation at all and no quick fixes either.

I fear one or more of the big three may end up in "B" if the government doesn't step in. I heard locally that creditors are looking for 750+ on your FICO score or the deal is off. That will remove many from the credit markets and car loans.

750 removes MOST. We used to do home mortgages until about a year ago and back in the good days 95% of people were below 700 FICO. Nowdays, who knows.

I do recommend however to walk outside and look up. The sky is still there. We will all get through this.

07_427r · #10 (**permalink**) 10-09-2008, 06:03 PM

Quote:

Originally Posted by TMN

I do recommend however to walk outside and look up.

Funny you should mention that. Just came in from watching the International Space Station fly over. I've seen it twice before. Very cool to see it!!!