Late last week, Standard & Poor's gave Ford a long-awaited boost: It upgraded the rating on Ford's debt to BBB-minus, the lowest tier of "investment grade" status. That move meant that all three of the major rating agencies were finally in agreement: Ford's stock has finally returned to the ranks of America's blue chips. It's no coincidence that the stock rose 4% last week.
Ford's world headquarters in Dearborn, Michigan. Photo credit: Ford Motor Co.
Why is this a big deal? Credit upgrades are always good for any company -- the higher a company's credit rating, the less it has to pay to borrow money.
But as Fool contributor John Rosevear explains in this video, it's also another sign that Ford's strong profits in North America aren't just a function of a rising American economy -- they're the result of deep structural changes that look increasingly likely to endure, no matter what the U.S. economy does in the future.
Ford's stock has had a strong run so far in 2013. But in order for Ford's stock to really soar, a few more critical things need to fall into place. In The Motley Fool's special free report entitled, "5 Secrets to Ford's Future" we outline the key factors every Ford investor needs to watch. Just click here now for your free report.
The article Why Ford Just Got a Big Upgrade originally appeared on Fool.com.
Fool contributor John Rosevear owns shares of Ford and General Motors. You can connect with him on Twitter at @jrosevear. The Motley Fool recommends General Motors. It recommends and owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.