The US automaker’s market value is reaching levels last seen in 1999, putting the company closer to its historical peak than the world’s biggest carmaker, Toyota Motor Corp.
Just yesterday, Ford traded at a market capitalization of more than $70 billion, a level it has closed at only three times in the last 14 years. That left the second-largest U.S. automaker within about $6 billion of its peak valuation in May 1999. Toyota ended the day $30 billion short of its $254 billion high reached in February 2007.
The higher value investors are placing on Ford followed a 17th-straight quarterly profit that showed progress in Chief Executive Officer Alan Mulally’s plan to extend beyond sales of trucks and sport-utility vehicles in developed markets that used to be the company’s strength.
“Not only is Ford challenging their own previous peak and are closer to it than Toyota, but Ford is competing with Toyota the way it wasn’t before,” said Kevin Tynan, an auto analyst for Bloomberg Industries. “It’s a competitive landscape that Toyota really hasn’t had to deal with in maybe 15 years.”
Ford’s gains also demonstrate faith that Mulally, 68, has established a team that can excel after his eventual departure. The executive reiterated yesterday the company’s plan for him to remain CEO through at least 2014. Still, Microsoft board members have spoken with Mulally about becoming its next CEO, according to people with knowledge of the talks.
The shares ended yesterday at $17.76, the highest closing price in almost 33 months. Ford has climbed 36 percent this year, outpacing the 23 percent gain by the Standard & Poor’s 500 Index. Less than five years ago, Ford closed at a low of $1.26.
) - Monday, October 28th, 2013 - filed under Ford
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