Top Stock to Buy #3 – Ford Motor Co. (F)
Ford Motor Co. (NYSE:F), the second largest producer of cars and trucks in the United States, also has automobile financing and insurance operations. Analysts expect Ford to increase revenues this year chiefly from operations in the United States, China, and most European countries.
After some weakness in the first half of the year, improved profits are expected in the second half of 2012, and 2013 revenues are expected to rise 9.7%. Earnings this year should fall to $1.46, but rise to $1.71 in 2013. The first-half decline should already be factored into the price of the stock. And these estimates may be very conservative in that the average life of cars “on the street” is currently over 10 years. Increased consumer appreciation of Ford’s product quality and confidence in its management should also raise demand for the stock.
Technically Ford broke its bear market resistance line in January, jumping from $10 in December to $13 in late January. It has been consolidating since then between $12 and $13, but just flashed a buy signal from its stochastic. A break from $13 should result in a quick run to $14 to $15. Longer-term investors should benefit from much higher prices and an increase in its dividend yield, now at 1.62%.