Short Microsoft, Buy Ford if CEO Walks

Tickers in this article: F MSFT

NEW YORK ( TheStreet) -- Rumors are still running wild that Ford CEO Alan Mulally will soon be boarding a jet for Seattle to replace current Microsoft CEO Steve Ballmer. 

On Monday, Jim Cramer and Stephanie Link sold their position in Ford, picked up some Macy's and told Action Alerts PLUS subscribers that the risk-reward ratio was better at Macy's than Ford . I'm still long because I don't buy this rumor, but believe Ford will be fine without Mulally anyway.

Some say he has a home in Seattle and is yucking it with Microsoft execs on a regular basis. Perhaps adding even more speculation into the mix is Mulally's refusal to flat-out deny he will go to Microsoft.
Sure he has indicated he is happy at Ford and plans to stay through 2014, but that doesn't mean things can't and won't change.

It only added fuel to the fire when Ford's board of directors granted Mulally permission to leave if he chose to go that route.

Once several weeks of rumors seemed to be quieting, a short-list of potential candidates became public days ago.  Of course, Mulally was included on the list, along with former Nokia CEO Stephen Elop and two internal candidates: Tony Bates, head of business development and Satya Nadella, executive vice president of Microsoft's cloud division. 

But I must ask, of all the people named above, why would Mulally be the top choice to turn the company around? 

I know he's a great leader with incredible focus, drive and determination. He ran Boeing very well and steered Ford clear of bankruptcy five years ago. 

But the dude's 68-years-old! No offense to Mulally, but if you're Microsoft, don't you want a little bit younger blood running a technology company of all things? 

And beyond that, Mulally is an industrial guy, not a computer whiz. He doesn't dabble in the cloud, coding, or software. No, he likes aerodynamics and machinery. 

Regardless of what I think or write though, Microsoft seems more than willing to take him if he wants to come on board. I believe there is nothing for Mulally to gain by leaving Ford. 

Again, he did a spectacular job avoiding bankruptcy, as well as improving efficiency and ultimately, returning Ford to profitability. For the last several years, investors have been spooked by retirement speculation, and cheered when he extended his earliest departure date -- currently agreeing to stay through 2014.

Now all of a sudden he's " likely" headed to a $315 billion market-cap company (roughly five times that of Ford), to turn things around? The "likely" quote above is according to Nomura Securities' Rick Sherlund, who expects the announcement to take place in roughly one month. 

I disagree. Mulally is likely to stay right where he is, because doing anything else aside from retiring simply does not make sense.