Ford broke from a right triangle, reinforcing our target

Ford Motor Company (NYSE: F) — Analysts are projecting that Ford will strongly outperform the market over the next 6 to 12 months, based on three key factors: earnings strength, relative valuation and recent price movement.

Earnings per share increased from a loss of $3.69 to an estimated $1.52 over the past five quarters, indicating an improving growth rate.

On Oct. 4, Morgan Stanley analysts initiated an “overweight” on the stock with a 2011 earnings target of $1.89 per share.

Technically, Ford has been consolidating within a right triangle since April, with support at its 200-day moving average. �

Yesterday, the stock broke from the right triangle following two buy signals from our internal Collins-Bollinger Reversal (CBR) indicator and a new stochastic buy.

This breakout reinforces our target for Ford of $16 by year-end.

Trade of the Day - F Stock Chart

Trade of the Day Chart Key

If you have questions or comments for Sam Collins, please e-mail him at samailc@cox.net.

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