In a matter of ten days, Ford shareholders will receive payment of the automaker’s first dividend in half a decade. The move, which will cost The Blue Oval a total of $200 million — or 5 cents per share, is payable March 1, 2012 to shareholders of record of Class B and common stock on January 31, 2012.
Ford is the first American automaker to pay a dividend on common stock since General Motors suspended its dividend during the carpocalypse of 2008. To that end, The General has been paying dividends on preferred stock, but not on common stock.
The Motrolix Take
We wouldn’t be surprised if part of Ford’s strategy involves instituting the dividend in order to elevate the grade of its stock, which is just a tad below investment grade at the time of the dividend’s announcement back in December of 2011. Additionally, the dividend is most likely going to grow in size, as Ford says that it has begun “at [a] level sustainable through economic cycles.”
Our guess is that as Ford further eliminates debt, the amount of the dividend will grow. As of December 31, 2011, the company had $13.1 billion in debt compared to $19.1 billion as of December 31, 2010 — a reduction of $6 billion.