Ford stock tumbles on sales estimates
Ford’s stock price fell to its lowest level since Dec. 22, 2009 during mid-day trading today following reports that industry sales were sluggish in June and as the company faces a Wednesday deadline to make an $860 million payment to a UAW retiree trust fund.
Ford’s stock traded as low as $9.82 mid-day.
The automaker is required to pay the UAW’s Retiree Medical Benefits Trust by Wednesday to fund health care benefits for former hourly workers.
Ford must pay $250 million of the required payment in cash and can pay as much $610 million in stock.
Bloomberg News reported on Monday that Ford might issue stock to make the payment so it can use cash to better manage its balance sheet. In the past, Ford shareholders have been concerned about additional stock diluting the company’s stock.
“We do not run our business based on day-to-day stock changes,” said Ford spokesman John Stoll.
But Ford’s falling stock price probably has little to do with how it will meet the trust fund payment obligation, said Mirko Mikelic, senior portfolio manager at Fifth Third Asset Management in Grand Rapids.
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2 Responses to “Ford stock tumbles on sales estimates”
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