Ford shares close higher on Friday, more than 953 000 vehicles to be recalled globally due to problematic air bag inflators

According to a report by MarketWatch on Friday, Ford Motor Company (F) intends to recall over 953 000 vehicles globally due to problematic passenger air bag inflators manufactured by Takata, which could explode and release shrapnel inside the vehicle.

Similar issue with air bag inflators has reportedly caused at least 23 deaths worldwide. However, Ford said it was not aware of any injuries in vehicles affected by the current recall.

Ford shares closed higher for the third time in the past thirteen trading sessions in New York on Friday. It has also been the sharpest daily surge since October 25th. The stock went up 3.86% ($0.30) to $8.08, after touching an intraday high at $8.12, or a price level not seen since December 21st ($8.40).

Shares of Ford Motor Company have risen 5.62% so far in 2019 compared with a 1.00% gain for the benchmark index, S&P 500 (SPX).

In 2018, Ford Motor Co’s stock plummeted 38.75%, thus, it underperformed the S&P 500, which registered a 6.24% loss.

According to MarketWatch, 782 000 vehicles are to be recalled in the United States.

Vehicle models included in the latest recall are Ford Edge and Lincoln MKX manufactured in 2010, Ford Ranger manufactured in 2010 and 2011, Ford Fusion and Lincoln MKZ manufactured in 2010, 2011 and 2012, Mercury Milan manufactured in 2010 and 2011 as well as Ford Mustang manufactured in 2010, 2011, 2012, 2013 and 2014.

Takata air bags are inflated through an explosion created by the use of ammonium nitrate. However, factors such as heat and humidity could cause the air bags to explode with too much force and, as a result, a metal canister designed to contain the explosion could be hurled inside the vehicle.

According to CNN Money, the 21 analysts, offering 12-month forecasts regarding Ford Motor Company’s stock price, have a median target of $10.00, with a high estimate of $13.00 and a low estimate of $6.00. The median estimate represents a 23.76% upside compared to the closing price of $8.08 on January 4th.

The same media also reported that 16 out of 23 surveyed investment analysts had rated Ford Motor Company’s stock as “Hold”, while 5 – as “Buy”. On the other hand, 1 analyst had recommended selling the stock.

Weekly Pivot Levels

By using the traditional method of calculation, the weekly levels of importance for Ford Motor Company (F) are presented as follows:

Central Pivot Point – $7.89
R1 – $8.31
R2 – $8.53
R3 – $8.95
R4 – $9.36

S1 – $7.67
S2 – $7.25
S3 – $7.03
S4 – $6.80