Ford Motor Co., Northrop Grumman Corp. and E.I. du Pont de Nemours & Co. are among 14 companies most at risk to lower their discount rates for valuing pension liabilities, according to a report by Goldman Sachs. "Some companies will likely lower their discount rates between 25 (and) 50 basis points," noted the report. "A lower discount rate ... will raise pension expense for most companies in 2005. For companies with sizable plans, this could result in downward earnings estimates revisions for this year" and hurt the companies' stock prices, the report said.
The 14 companies, whose fiscal years ended Dec. 31, had discount rate assumptions ranging from 6.25% to 6.3% in 2004.