DO NOT *fear* Share Dillution!
Ok so... I sold my FORD stake and threw the cash at (DPS) and (EAG). Beverage + defense stocks a few weeks back.
That was around $5.89. I did this because of reading an article about C.E.O. Mullaly thinking about doing more Share Dillution to clean the balance sheet. Remember that article? That article scared me.... Luckilly though I discovered that Share Dillution doesn't mean a thing!
I quickly threw cash at FORD last week Friday to jump back into the stock.
Many articles are printed and published regularly to get investors scared about Share Dillution.
Last year my biggest mistake of my investment career was dumping (FEED) because of share dillution. Wow! Was I wrong... Share price has recovered Quintuple ever since the SPOOK SCARE over share dillution.
How many other companys have had their stock prices escalate after the short term drop over Share Dillution Spook Scares? How about nearly the entire Financial Sector. Everyone thinking Bank of America should still be a $1.00 or less stock due to dillution is forgetting something...
I've learned that SHARE DILLUTION.....IS.....NOTHING.....TO BE....AFRAID OF!!!
Look at your investment.... If you believe the company will survive the recession and grow stronger and stronger as the days, months, years go on... Then the short term OH MY GOD Share Dillution is meaningless and you shouldn't bother fretting over it.
Really... When it comes to share dillution on my (FORD) stock.... from now on the only thing on my mind is..."How can I participate in the secondary offering?"
P.S. Ford reports strongest month in sales since Sept. 2008! Ford reports a REBOUND!
P.P.S. Why doesn't share dillution matter? Because the future of a strengthening company is a future of SHARE BUYBACKS that reverse the Past's share dillution. Share dillution This YEAR is no big deal when you predict Share Buy Back next year or the year after.