Market News

Ford Chairman Acquires 2M Shares of the Automaker — Report

Ford’s (F) chairman Bill Ford has acquired 2 million shares of the company. According to a report published by Bloomberg, the great-grandson of founder Henry Ford paid $20.5 million in cash for the stock options. The executive used cash to pay for exercise costs. Shares of the automaker fell 1.21% to close at $19.57 on December 9.

Ford is the third-largest automaker in the U.S. The company designs, manufactures, and sells cars, trucks, and automobile parts. It currently makes cars under two names — Ford and Lincoln.

Insider Buying

Following the acquisition, Ford now owns 20 million of the company’s shares, including restricted stock. The holdings also include 15 million worth of special class of super-voting stock in the automaker. The holdings are currently valued at about $400 million.

The Ford chair acquiring the shares affirms his belief about the automaker’s growth metrics and long-term prospects. In an emailed statement, the automaker reiterated its intentions to create value for all stockholders. (See Top Smart Score Stocks on TipRanks)

The acquisition comes a month after Ford stock rallied to a 20-year high. The rally came as investors bet on the company amid its aggressive push into the burgeoning electric vehicle space. The stock has been on an impressive run, rallying by over 200% since the appointment of Chief Executive Officer, Jim Farley, 14 months ago.

Stock Rating

Last week, RBC Capital analyst Joseph Spak reiterated a Buy rating on Ford and raised the price target to $21 from $17, implying 7.31% upside potential.

Consensus among analysts is a Moderate Buy based on 9 Buys, 3 Holds and 2 Sells. The average Ford price target of $18.69 implies 4.50% downside potential.

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