Me, I like a company with a little brag to it. I want to see some swagger out of the firm's into which I put my money. So should you, frankly. I can take boring companies. I can take a brash company. I can even take confusing companies. But I absolutely cannot abide timid companies.
Seriously, it's a competitive world out there. A firm has to have leadership that is confident and bold to succeed in today's market. Nowhere is that more apparent than in the auto industry. I'm not telling you anything you don't know when I say that automakers have had one heck of a rough couple of years. I'm not certain any industry got demolished worse than car makers during the recent unpleasantness.
That's why it's so refreshing to see Ford Motor Company (NYSE:F) commit to its long term success the way it did this morning when it announced that it is doubling its dividend. Admittedly, that's all the way to 10 cents per share, but still, it's doing it. The corporate leadership is confident that the firm's recent gains, such as a great December and a Q3 profit of $1.6 billion, are going to be around for a long time. That sort of statement is a real confidence builder to me.
The simple truth is that Ford came through the troubles about as well as could be expected. Remember, it was only in 2005 that the company's bonds were junk-rated. Then a series of truly astonishing losses in the 11-figure range (!!!) happened, then the great recession. I wouldn't have blamed anyone for being bearish on Ford at that point.
Still, the firm pulled through. It rejected a government bailout that its competition took and developed a plan. Now that plan is coming to fruition and shareholders are going to start reaping some profits on it. Honestly, in late 2008 Ford's stock dropped below $1.50 per share. It's been through the mill since then, but the stock is sitting at $13.79 as I type this (Jan. 10, 2013) and I see no reason to believe it can't go quite a bit higher.
How is Ford different from some of the competition? Let's take a quick look.
General Motors Company (NYSE:GM)
Now, this is a firm that DID take a government bailout. While it's done fine, it's still digging its way out of the deep hole it was in. An EPS of just 2.66 and still no dividend makes it look like a weak pick. I'm told by many that it'll do well, but at the close the firm's stock was at $30.60. That significantly up from a yearly low of $18.72 in July, but it's not enough for me to pick any up.
Honda Motor Co Ltd (NYSE:HMC)
Honda's had a wild ride this year. Back in March 2012 it topped out at $38.22 and it's just getting back to that level now. The firm has both raised and lowered its dividend this year, to the confusion of everyone. But back in October it did have to lower its expectations by about 10%. Not a happy time. The stock's up right now, but it's been down recently, too. Be wary but optimistic. Management is usually pretty good at Honda, so there's no reason to be completely pessimistic.