Nov 26 (Reuters) - Ford Motor Co (F.N) may fall below minimum cash levels by $2.7 billion in the second half of 2009, said a Barclays Capital analyst, who also lowered his price target on the automaker’s stock by $2.
“With greater than anticipated cash burn in third quarter and the automotive downturn expanding globally, we estimate that Ford is likely to fall below minimum cash levels in 2H09, requiring Ford to either tap its available credit lines or request government assistance,” analyst Brian Johnson said.
However, the analyst estimates that Ford has positive equity value without government assistance.
Earlier this month, rival General Motors (GM.N) warned it will run desperately short of cash by early next year without government aid or other drastic measures.
Analyst Johnson cut his price target on Ford shares to $4 from $6 and widened his 2008 and 2009 loss estimates for the automaker, citing a slower expected recovery in 2010. The analyst has an “equal-weight” rating on the stock.
Ford shares closed at $1.66 Tuesday on the New York Stock Exchange.
The following table lists the changes in Ford’s estimates made by the analyst —
2008 ESTIMATE* 2009 ESTIMATE* 2010 ESTIMATE*
NEW OLD NEW OLD NEW OLD
$-3.08 $-2.51 $-1.65 $-0.90 $0.50 $0.75
* All estimates are in per-share figures (Reporting by Jennifer Robin Raj in Bangalore; Editing by Himani Sarkar)