What's Driving Ford?

Legendary fund manager Peter Lynch once said that you shouldn't invest in any idea you couldn't illustrate with a crayon.

Though I'm not much for crayons, I do love the pithiness of that line. We regularly preach the same idea at the Fool: Don't buy what you don't understand. And if you can't simply sketch out a company's business model -- how it actually makes money -- then maybe you shouldn't be investing in it.

As a Ford (NYSE: F  ) shareholder, I can attest to the fact that it's been a tough year. I've seen more and more Fords on the road, but the share price hasn't reflected that observation the way I would have hoped. Let's take a graphical look at Ford's revenue performance over the past three years and see whether we can figure out why the stock price might be lagging in the face of strong revenue growth domestically. (Note: I'm focusing on revenues here, not earnings.)

Source: Ford 2011 10-K.

Think I missed something in this illustration? General thoughts on this exercise? Let me know in the comments section below. And if you haven't already, be sure to follow our Ford news and commentary using the Fool's free new My Watchlist tool.

Fool.com graphics/photo/art editor Dari FitzGerald owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


Read/Post Comments (2) | Recommend This Article (14)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 11, 2012, at 11:35 PM, robbielaney wrote:

    How did you create the info graphic? I've been trying to figure out a way to do info graphics like this.

  • Report this Comment On June 18, 2012, at 11:06 AM, TMFMarlowe wrote:

    Wonderful graphic, Dari, and it makes a very important point about Ford. I'm going to be linking to this one for months.

    John Rosevear

Add your comment.

DocumentId: 1908171, ~/Articles/ArticleHandler.aspx, 7/28/2014 9:15:34 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement