Stern Value Mangement Interview Vasishta Atmuri Presentation
Ford Motor Company
Valuation Business Case
Stern Value Management Interview
Vasishta Atmuri
December 5, 2014
Ford Motor Co. Analysis| Stern Value Management Interview
Introduction
Ford Motor Co. manufactures and sells cars and is the sixth-largest car maker
Stock Price in $
20
1000000000
800000000
600000000
400000000
200000000
0
15
10
5
FINANCIAL HIGHLIGHTS
Ticker
F
Date, as of
12/03/2014
Stock Price
$16.01
P/E
10.47x
Market Cap (mm)
$61,617
Dividend Yield
Ford Motor Co. (NYSE:F) - Volume
Ford Motor Co. (NYSE:F) - Share Pricing
Ford Motor Co. (NYSE:F) - Share Pricing (Announced/Completed Transactions)
Shares Out. (mm)
3.1%
3,848
RECENT NEWS
MANAGEMENT
Ford, William Clay
Executive Chairman, Chairman of Finance
Committee
Fields, Mark
Shanks, Robert L.
Chief Executive Officer, President and Director
Chief Financial Officer and Executive Vice
President
Rowley, Stuart J.
Chief Accounting Officer, Vice President and
Controller
Ford Motor Co. Analysis| Stern Value Management Interview
• Ford is the top seller in Canada as car sales rose 4% in November; Yearly sales of 269K
• Car prices rise in November with Ford’s average car price increasing +2.6% to
$35,832; foreign makers such as Honda and Volkswagen saw a reverse trend
• Decline in oil prices result in stock price increases for automobile manufacturers • Like all manufacturers, Ford is plagued by recalls of models such as Lincoln and Ford Crossovers
Financial Performance: Indicators
Sales and profitability metrics indicate declining performance
Revenue, Gross Margin and Net Income Margin
150000
25%
145000
Revenue in $billion10.2%
140000
135000
16.0%
13.9%
6.4%
5.1%
2.3%
13.3%
12.9%
12.3%
4.2%
4.9%
4.2%
15%
Growth rate and Margins
5%
130000
-5%
125000
120000
-15%
115000
110000
Dec-31-2009A
Total Revenue
Dec-31-2010A
Dec-31-2011A
Growth Over Prior Year
Return
Gross Margin
Dec-31-2013A
Sep-30-2014A
-25%
Net Income Margin
OBSERVATIONS
Return on Assets, Return
Valuation Business Case
Stern Value Management Interview
Vasishta Atmuri
December 5, 2014
Ford Motor Co. Analysis| Stern Value Management Interview
Introduction
Ford Motor Co. manufactures and sells cars and is the sixth-largest car maker
Stock Price in $
20
1000000000
800000000
600000000
400000000
200000000
0
15
10
5
FINANCIAL HIGHLIGHTS
Ticker
F
Date, as of
12/03/2014
Stock Price
$16.01
P/E
10.47x
Market Cap (mm)
$61,617
Dividend Yield
Ford Motor Co. (NYSE:F) - Volume
Ford Motor Co. (NYSE:F) - Share Pricing
Ford Motor Co. (NYSE:F) - Share Pricing (Announced/Completed Transactions)
Shares Out. (mm)
3.1%
3,848
RECENT NEWS
MANAGEMENT
Ford, William Clay
Executive Chairman, Chairman of Finance
Committee
Fields, Mark
Shanks, Robert L.
Chief Executive Officer, President and Director
Chief Financial Officer and Executive Vice
President
Rowley, Stuart J.
Chief Accounting Officer, Vice President and
Controller
Ford Motor Co. Analysis| Stern Value Management Interview
• Ford is the top seller in Canada as car sales rose 4% in November; Yearly sales of 269K
• Car prices rise in November with Ford’s average car price increasing +2.6% to
$35,832; foreign makers such as Honda and Volkswagen saw a reverse trend
• Decline in oil prices result in stock price increases for automobile manufacturers • Like all manufacturers, Ford is plagued by recalls of models such as Lincoln and Ford Crossovers
Financial Performance: Indicators
Sales and profitability metrics indicate declining performance
Revenue, Gross Margin and Net Income Margin
150000
25%
145000
Revenue in $billion10.2%
140000
135000
16.0%
13.9%
6.4%
5.1%
2.3%
13.3%
12.9%
12.3%
4.2%
4.9%
4.2%
15%
Growth rate and Margins
5%
130000
-5%
125000
120000
-15%
115000
110000
Dec-31-2009A
Total Revenue
Dec-31-2010A
Dec-31-2011A
Growth Over Prior Year
Return
Gross Margin
Dec-31-2013A
Sep-30-2014A
-25%
Net Income Margin
OBSERVATIONS
Return on Assets, Return