In this article we will discuss Ford Motor Dividend Policy. Ford Motor Company issues dividends to its shareholders and for the life of me, I do not understand why. The company is rapidly losing market share in US, and recently Toyota usurped Ford's position of Second Largest Automaker of the world in July 2006. Toyota is also expected to take over Ford's place of Number 2 producer in United States. If that isn't enough Ford Motor reported sales in January 2007 dropped by as much as 19%. Not only that, Ford posted a record loss of $12.7 billion for the year 2006. In midst of these times, I cannot imagine how a company like Ford, in such a financial position doles out dividends to its shareholders. The company isn't exactly raining with cash. It has taken huge amounts of loans to restructure, and is paying dividends to its shareholders? Talk about messed up priorities. I hope that Ford and other American Automakers get their act straight and stop paying dividends, and instead use the precious money to invest in the company's future. If Ford cannot use the money it has properly, how will it use the money it has borrowed for restructuring effectively?
Is Ford afraid that if it stops paying dividends, its stock is going to crash? I mean how much more bottom can u get, it's not exaclty as if Ford is at the top of the world, in fact it is at the bottome, and since you are the bottom any way, it is time to take drastic steps, I don't think Ford should not be worried about signalling effects, if it decided to cease paying dividends.
In this article we will only cover dividends given by Ford from 1996 to present. Ford has always been paying dividends. For example, Ford paid a dividend per share of $0.60 from the first quarter of 1956 to second quarter of 1958. The highest dividend Ford Motor paid out through 1956-Present was a solid $1.00 in the second quarter of 77, second quarter of 79 through second quarter of 1980. That must have been really nice, being paid a $1 dividend of a Ford Share.
Ford Paid a dividend of $0.35 per share for the first 2 quarters of year 1996, paid $0.385 dividend for the remaining 2 quarters and the first quarter of year 1997. In the year 1997, Ford paid a dividend of $0.42 per share for the remaining three quarters of the year, and the first three quarters of 1998. A dividend of $0.45 was paid for the last quarter of the year, and the starting three quarters of 1999. For the last quarter and the first 3 quarters of the next year, Ford paid a dividend of $0.50 per share. From the last quarter on 2000 onwards, Ford paid less dividends to its shareholders. The company dividends fell by $0.20. The company issued a dividend of $0.30 for the last quarter of 2000, and first three quarters of 2001. In the last fiscal year of 2001, its dividends were cut in half. Ford now paid its shareholders only $0.15 per share. From the start of Fiscal year 2002 onwards, the company paid a dividend of $0.10 per share until second quarter of 2006, down $0.05. In the third quarter of 2006, the dividends were halved and Ford paid a dividend of $0.05 per share.
For those who would like to know the current trading stock price of Ford Motor Company, Ford is currently trading at $8.73 as of 2:50 PM ET. Ford stock is up $0.80, over the opening price. Ford stock opened at $8.82.
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