Ford investors 'want some comfort' as equities drop to six-year low

The sale at Ford is gaining momentum.

The automaker's shares fell 3.4% on Tuesday to close at $ 8.95, ending the day below the $ 9 mark for the first time since August 2012. Stocks have fallen more than 28% since the start of the year. l & # 39; year.

While analysts explain Ford's slide by a host of reasons, the most important factor is the uncertainty surrounding CEO Jim Hackett's plan to restructure the Detroit company. Hackett and his management team have not yet revealed how they will reshape the automaker, although this is clearly a lighter and more focused company.

"Hackett's plan and vision is still causing a lot of uncertainty," said Dave Whiston, an automotive analyst at Morningstar.

The pressure has increased on Ford since the company announced mediocre results for the second quarter and announced the postponement of a meeting of analysts in September. Hackett was generally expected to reveal the details of the restructuring.

Meanwhile, Ford is announcing to employees that it will reduce its paid workforce by about 70,000 people worldwide. It is unclear exactly how many white-collar employees will be fired.

"We are about to reorganize our global payroll workforce to support the company's strategic goals, create a more dynamic and empowering work environment, and become more fit as a company," said Ford. in a statement to CNBC. "The reorganization will result in downsizing over time and it will depend on the team and the venue."

Garrett Nelson, an automotive analyst at CFRA Research, said he was frustrated by the lack of information. "Their strategy really has no visibility," said Nelson, who has a sustainment rating on Ford with a price target of $ 9. "There are also no real catalysts on the horizon."

Instead, there are a host of questions about how analysts and investors perceive the builder. Will the company be forced to reduce its dividend? Ford CFO Bob Shanks has repeatedly said that this is not something to take into consideration.

What's going to happen with Ford's overseas operations struggling? Can Ford show earnings growth and improved cash flow even though the auto industry appears to be lagging behind in the current sales cycle?

Whiston summed up the situation in these terms: "Investors want comfort, Ford is going in the right direction".

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