Ford Unleashes Good News: Dividend Hike, Mulally Stays, F-150 Improves
DETROIT (TheStreet) - Ford
Ford said the first-quarter dividend will be 12.5 cents a share, up from 10 cents a share. A half hour before the opening bell, shares were up 24 cents to $15.78.
"Our capital strategy continues to be focused on financing our One Ford plan, further strengthening our balance sheet and providing attractive returns to our shareholders," said Chief Financial Officer Bob Shanks, in a prepared statement. "This increase in the dividend provides our shareholders with a regular, growing dividend that we believe is sustainable over an economic or business cycle."
Ford shares have recovered since they took a hit on Dec. 18, when the company announced that its 2014 pretax profit will decline from 2013 levels due to costs associated with 2014 new product introductions. Shares opened that day at $15.99 and closed at $15.65, after declining to as low as $15.17 in intraday trading.
Since then, the news has been good and getting better.
On Wednesday, CEO Alan Mulally told The Associated Press that he will remain at Ford at least through 2014 and will not accept a job at Microsoft
In after-hours trading following the story's publication, shares rose from $15.58 to $15.73, Wednesday's opening price.
On Thursday came the dividend increase. On Monday, the first day of the Detroit Auto Show, Ford is expected to reveal the new 2015 F-150 pickup truck. The truck "will likely be the most important product introduced at the auto show," Deutsche Bank analyst Rod Lache wrote in a note on Wednesday.
The dividend increase is the second in the past two years. Ford restored the dividend at a rate of 5 cents a share in the first quarter of 2012. It increased the dividend to 10 cents beginning with the first quarter of 2013.