The Tech Stock Investor

As Ford continues to crumble in domestic markets and fights to stay alive in the world market, investors continue to punish the stock price. Ford has been fighting a losing battle for several years now. Facing everything from UAW contract fights, economic hardships, and even negative publicity for its continued stance in the controversial support it provides to Gay and Lesbian organizations.

The company recently signed new contracts with the UAW and has been selling plants and other assets to meet expectations. A plan to build a new plant in North America seems to have been put on hold or abandoned altogether, and the planned sale of Volvo has been scrapped since a buyer will not likely be found.

A recent scan over the number for the company at Reuters was very eye-opening. As I glanced over the ratios listed I could not help but notice something: a number of them had “NM” instead of an actual number. “NM” generally means “Not Meaningful” of course, and that pretty much sums up the action at Ford. Dividend Yield, PE Ratio, and 5 Year EPS all reflect this along with a number of the other ratios.

It’s pretty sad for Ford (and its employees) to see things going this way, but maybe management can get things back on track before shareholders decide to issue some pink slips. Of course, with the way this company has been run into the ground, pink slips may not be such a bad idea.

GM has been in decline for a long time. In the scope of corporate life cycles, GM may be in the final decline. Getting hammered in the domestic market, the world’s largest auto maker was outsold by Toyota. An aging workforce, huge pension debts, and UAW woes have all but ruined the balance sheets and it still faces four more years before nearly half its hourly workforce will be retired.

Now if a $39 billion tax related loss in the news is not even enough to kill share prices more than a few percent, nothing will. This is not the first time GM has had to declare losses in this industry and each time, they have dumped their losses, watched share prices dive only to come back in the ring swinging. I do not think that will be the case this time. Sure, a fighter may come back into the ring with a few final gasps, but most of them do not make the big comeback. GM will probably be the same. They will shed more divisions in fire sales and spin-offs, maybe even do some more cost-cutting (which seems to be a never ending battle to begin with), but after all is said and done will GM still be the same company?

What can be said of a company who has been outsold in their own domestic market by a foreign competitor? Then GM has the guts to compete with the Asians in their own markets? I think its time the GM management and the US Congress think about this: come back home and work on getting things straight here and let the world worry about its own problems.

Every day it seems we have new lows or new high in indexes, stock prices, or economic reports. Extremes of these are commonplace in these times and pundits are screaming recession or crooning about false alarms and fat bull markets to come. Who to believe? The market. No matter which way the wind blows, the market keeps right on going. She can care less who the president is or whether the GDP is up a point. Sure, those things may make a ripple in the market, but the key here is those ripples travel right out of the market and she keeps lapping at the shores of the economy lulling investors.

Years ago, any given economic indicator could topple a bull market or bring a bear to life. Today’s economy is just not working the same way. This is definitely not your father’s stock market. It’s a scary place to be sometimes but money is being made everyday. There’s gold in them there hills and everyone keeps coming back for more. You just have to find your niche and start drawing cash out of the market while you can.

So are you waiting for the powder keg to explode before putting your money in? Or do you already have it invested and waiting for the explosion? Either way, whether she blows or not, money will be made and you can take that to the bank.