The reward far outweighed the risk with the stock down 50% on factors that are bound to improve over time. I feel this statement perfectly illustrates where Ford's stock was at the beginning of July. "Search for companies that offered low prices and an excellent long-term outlook." He referred to his investment philosophy as "bargain hunting." Templeton's guiding principle was: Templeton is known as a contrarian investor.
"Invest at the point of maximum pessimism." One of my favorite quotes from investing icon Sir John Templeton is the following: Often these types of transitory issues create an opportunity to buy stock in a solid company with sound prospects. The sales indicated the worst since Q1 of 2020 (89K units) when government COVID restrictions halted the production in the country."Įven so, I saw the selloff of the stock based on macro factors, such as the China COVID shutdowns and supply chain issues as temporary. "During the second quarter, Ford sold a mere 120,000 vehicles in Greater China marking a ~22% year-over-year decline led by rising COVID cases and ongoing global supply chain problems. The recent upside push in the stock had actually occurred in the face of some negative news breaking as well showing the move had solid relative strength. This is the first sign a trend reversal is underway. Furthermore, there were little to no upside breakouts along the way.Įven so, the stock was up 4% for the week and just recently broke out above the top of the downtrend channel. The thesis was Ford's stock price had plummeted 50% over the past six months. I wrote an article on July 9 stating Ford ( NYSE: F) was destined to double.