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Ford Is Cheap at $5

Posted July 21, 2008

“At this point, the market cap for Ford is a paltry $10.13 billion. However, the company has over $25 billion in cash on the balance sheet. Granted, they have tremendous debt on the balance sheet as well, but they have more than $11 in cash per share.” — Rick Pendergraft

by Rick Pendergraft

Baltimore — (TFN): You may remember the old acronyms for Ford: “Found On Road Dead” and “Fix Or Repair Daily.” People used them to make fun of the reliability problems Ford (F:NYSE) had in the past. But they could also apply to Ford’s stock in recent years.

Since 1998, Ford has dropped from a high of $38.63 and is now trading under $5 per share. The last time Ford was this low, in 1991, some of my colleagues weren’t even old enough to drive.

At this point, the market cap for Ford is a paltry $10.13 billion. However, the company has over $25 billion in cash on the balance sheet. Granted, they have tremendous debt on the balance sheet as well, but they have more than $11 in cash per share.

I am not saying you should rush out and put all your available funds into Ford stock. But for a long-term investment (5-10 years), Ford looks like a bargain at this point. Read on to learn more.

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Posted by Rick Pendergraft · Filed Under US Stocks and Markets 

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