Market Overview

Leaner And Meaner: Ford Is The Only Auto Stock Cramer Likes

Share:
Leaner And Meaner: Ford Is The Only Auto Stock Cramer Likes

Ford Motor Company (NYSE: F)'s days of producing a "one-car-fits-all worldwide strategy" have passed — which makes it the only auto stock worth buying, according to CNBC's Jim Cramer.

What Happened

Ford's transformation is the "real deal" as the company no longer has a strategy of producing cars everywhere at any cost, Cramer said during his daily "Mad Money" show.

Instead, the company simply makes cars it can sell for a profit, especially the F-150 — which Cramer said happens to be the "best truck in the world."

Ford is moving away from areas that aren't as strong, Cramer said. For example, Ford stopped production of poor-performing vehicles in Europe, Latin America and Russia.

The company has plans to lower its workforce in China by 10 percent in reaction to a 37-percent drop in sales throughout 2018, the CNBC host said.

Why It's Important

Ford CEO Jim Hackett is "finally delivering" on a turnaround plan that also focuses on reducing costs under its new CFO Tim Stone, Cramer said.

Ford is becoming a "leaner, meaner, more focused company" that should be able to deliver superior products even if sales shrink, he said.

"This is the one auto-related stock I am willing to endorse right now because Ford has figured out the auto business stinks."

What's Next

Just a few months ago, some Street analysts were concerned Ford's dividend could be reduced, while others were concerned with the company's overall outlook, Cramer said.

Hackett sent a memo to employees urging them to "bury" 2018's poor performance in a "deep grave" and to double operating profit moving forward.

Ford traded around $10.34 per share at time of publication. The stock is up 35 percent in 2019.

Related Links:

Morgan Stanley: Ford's Beat Should Help Improve Access To Capital

Morgan Stanley Underwhelmed By Volkswagen's Valuation Of Ford Mobility Unit

Photo by Dave Parker via Wikimedia

Posted-In: automakers cars CNBC Jim Cramer Jim Hackett Mad MoneyMedia Best of Benzinga

 

Related Articles (F)

View Comments and Join the Discussion!
Lightning Fast
Market News Service
$199 Free 14 Day Trial
Book A Demo
Learn How You Can Succeed In The Market With Benzinga Pro

Fastest Market News

Real-Time News Alerts

Customizable News Filters

Book A Demo

In The Search For Safety, Don't Miss The Swiss

64 Stocks Moving In Tuesday's Mid-Day Session