Ford Creates Another Revolution

A recent report from Morgan Stanley said, Ford

didn't just avoid bankruptcy in 2009, it took advantage of exceptional economic and political circumstances to slash capacity, renegotiate healthcare, divest non-core brands, cut debt, preserve valuable tax assets and reduce its breakeven point. While the improvement to Ford's cost structure has not gone unnoticed by investors, the revenue opportunity is significantly underestimated. Morgan Stanley EPS is nearly 40% above consensus for 2011 and 11% above for 2012. Ford should be well on its way to achieving an investment grade credit rating as it turns $5.4 bn of net auto debt as of 2Q10 into $1 bn net cash by the end of 2011 and $9 bn net cash by 2013. Ford is almost 4% higher at $12.71