January 5, 2010 - Ford stared into the abyss that was 2009 and came away from the edge unscathed. Of the three major U.S. auto manufacturers, it stayed out of bankruptcy, never borrowed money from the government, and now it's gaining market share while others continue to lose it. So is the stock a buy?

Here are some of the latest numbers: In December Ford sold 33% more cars than it did in December of 2008. Actual numbers were 184,655 cars and trucks compared to 139,067 last year. Ford, which owns Lincoln and Mercury, had total car sales in the month of 61,195 or 42% better than last year's sales. Trucks continue to roll off the floors. Its popular F-series sold 29.4% more than last year's last month, the total being 117,822. Ford thinks it owns 15% of the market now, up 1% from its 2008 position. It's the first time since 1995 the company increased market share.

From a fundamental perspective, here's what Ford looks like: Forward P/E is 23 since analysts think the company will show earnings this year of 48 cents a share after finishing in the red for 2009 at an estimated negative 32 cents a share (analysts' consensus estimates for 2009 and 2010). Price to sales is .30. Book value is negative $2.62 a share. Total cash is $32.74 billion. Current ratio is 1.25. Total cash per share is $9.90. Total debt is $132 billion. 52-week low was hit on February 20, 2009 at $1.50. The high was hit on January 5, 2010 at $11.21. There are 3.31 billion shares outstanding. There is no dividend.

Analysts believe the company will make a profit this year of 48 cents. That's refreshing after losses in 2006, 2007, 2008 and '09. Recovery could come quickly. In the auto business momentum matters. Ford has a good image since it avoided bankruptcy and shunned tax payers' money. That helps. But what matters is the cars and trucks.

The Ford Fusion has been a home run by any measure. Reviewers love it. Consumers are buying it. Sales in December were up 83%. The small SUV Escape had sales jump by 75%. Taurus was the biggest winner with an increase of 110%. The long running Mustang saw 62% more sales. Clearly, the company is delivering what consumers want.

Other good news: Ford didn't spend as much in December to incent buyers. It gave $2994 per vehicle for consumers to drive one away, that's down from $3070 in November and $3985 in December of 2008.

But not all the news makes us feel better. Overall, Ford sales were down 15.4% in 2009. For the industry, total sales were 10.6 million vehicles, down 21% from 2008. Using the December sales as a gauge, an anlayst with Ford estimated industry sales were in the 11.5 million annual sales range. Furthermore, the average incentive spending per vehicle in December was $2542, almost $400 less than the Ford average.

Analysts have a mean recommendation of 2.4 for the stock this week (not updated since the new numbers were announced on January 5). 1 is the highest or strongest buy recommendation, 5 is the lowest or sell recommendation. Analysts are on the fence on this one. They have a High target of $15 a share for one year from now, a low target of $4.00 and a Median target of $10.75. There are 12 analysts in the survey.

If we only look at the numbers from a risk reward perspective, and if the analysts are anywhere near correct, we can see that $11 (where the stock is now trading) is a lot closer to $15 (the highest target price for next year) than it is to $4.00 (the lowest target price). And $11 eclipses the median of $10.75, suggesting that the stock is currently fully valued.

But all of that is based on what analysts knew before the January 5 announcements. The company delivered better results than anyone expected (except maybe Mr. Soros and a few other shrewd investors). Can it continue to over deliver?

There's no question it has the right CEO in Alan Mulally. He's been spot on in his decisions for Ford since he came over from Boeing. He brought back the Taurus name, put it on a quality car, and sales rocketed. He raised money whenever he could, prepared for the worst, cut costs, and survived the worst economy since the depression. Never underestimate the power of a great manager. He's the right man at the right time for Ford. He's the single most important factor for future well being of the company.

Yes, the numbers are mixed but going in the right direction. Sales are definitely better. If the economy can hold at this level, if more jobs are created, if interest rates stay low, there's no question Ford stock will go higher as more cars will be sold. But if any parts of that equation are missed, the one factor that won't change is Alan Mulally and his competence. While I wouldn't buy the stock at $11, if it takes a breather and breaks below $10 again, it deserves a good hard look.

- Ted Allrich