Ford shares close lower on Wednesday, auto maker announces the recall of 375,000 Explorer SUVs

Ford Motor Co (F) announced on Wednesday the recall of nearly 375,000 Explorer SUVs in North America, because of a part that could detach and cause a crash.

Ford shares closed lower for the seventh time in the past ten trading sessions in New York on Wednesday. It has also been the steepest single-session loss since September 21st. The stock went down 3.05% ($0.24) to $7.64, after touching an intraday low at $7.63, or a price level not seen since October 30th ($7.61).

Shares of Ford Motor Company have retreated 17.85% so far in 2020 compared with a 6.58% gain for the benchmark index, S&P 500 (SPX).

In 2019, Ford Motor Co’s stock went up 21.57%, thus, it again underperformed the S&P 500, which registered a 28.88% gain.

The recall, which affects some vehicle models produced between 2013 and 2017, came as a result of possible fracture of the outboard section of the rear suspension toe link.

The US auto maker said it had been informed about 13 crashes and 6 injuries associated with the issue.

Analyst stock price forecast and recommendation

According to CNN Money, the 16 analysts, offering 12-month forecasts regarding Ford Motor Company’s stock price, have a median target of $9.00, with a high estimate of $11.00 and a low estimate of $4.90. The median estimate represents a 17.80% upside compared to the closing price of $7.64 on November 4th.

The same media also reported that at least 12 out of 18 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.

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