Recently, we found out about something of a potentially serious issue brewing for legacy automaker Ford (F). The United Auto Workers (UAW) union was attempting to establish a presence at the BlueOval SK plant in Kentucky, a move that would put the UAW in a position to build the next generation of vehicles. Now, the UAW is claiming victory, though some challenged ballots remain. And Ford suffered, with shares down nearly 2% in Thursday afternoon’s trading.
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The reports suggest that early returns showed the UAW won the union vote at the plant, but there were two issues. One, there were a set of “contested ballots” involved, in which the vote was not so clear. Two, the vote was close to begin with. Thus, if those “contested ballots” are sufficiently swung against the UAW, the UAW could be out after all.
Reports note that the vote turned out 526 for and 515 against. However, 41 ballots are contested. The UAW asserts that the contested ballots never should have existed to begin with, cast by employees who were “…ineligible to join the bargaining unit.” No matter which side claims victory here, it will not be a big win. The vote was simply too close to be anything else.
Oh, and Another Half-Million Vehicles Recalled
It would have been remarkably depressing to issue another article about Ford recalls for the second day in a row, so I am grateful for the union update. Yes, there is another, completely separate Ford recall, and this time, around half a million vehicles are impacted.
This time, the matter relates to a ruptured hose in the brake system, which could cause brake fluid to leak. This in turn can reduce the effectiveness of brakes, lengthen stops, and potentially cause brakes to fail altogether. There are no reports of accidents, yet. The vehicles impacted are the Lincoln MKX from 2016 to 2018, and the Ford Edge from 2015 to 2018.
Is Ford Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Hold consensus rating on F stock based on three Buys, eight Holds and three Sells assigned in the past three months, as indicated by the graphic below. After a 7.2% rally in its share price over the past year, the average F price target of $10.77 per share implies 8.07% downside risk.
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