Ford Firm Overview
Zacks Rank #5 (Robust Promote) inventory Ford Motor Firm (F), established by Henry Ford in 1903, is an American automotive producer headquartered in Dearborn, Michigan. Being one of many world’s main automakers, Ford supplies an enormous product portfolio of vehicles, vans, SUVs, and industrial automobiles, together with its luxurious Lincoln model and electrical automobiles (EVs).
Ford Earnings Miss Amid EV Weak spot, Competitors
Checkered EPS Shock Historical past
Ford’s latest earnings historical past has been checkered, with some quarters beating, and a few lacking badly. Presently, the July quarter is in management. F shares stumbled greater than 18% on quantity turnover practically 4 occasions the norm, after the automaker missed Zacks Consensus estimates by a large margin of 26.56%. Conversely, fellow legacy automaker Normal Motors (GM) has crushed Wall Road’s earnings estimates.
Picture Supply: Zacks Funding Analysis
EV Market Slows, Competitors is Fierce
An integral motive Ford missed earnings estimates is weak spot in its EV phase. Ford has been pressured to scale down its EV manufacturing amid slowing EV demand. In the meantime, although EV demand will doubtless choose up ultimately, Tesla (TSLA) dominates the market by a major margin. Additional, many purchasers who need to keep away from diving dive straight into an EV are choosing hybrids from Toyota Motors (TM), leaving Ford out within the chilly.
Ford’s relative weak spot is illustrated not solely in its faltering fundamentals but additionally in its share value. Tesla and GM are up 62.6% and 57% over the previous 12 months, respectively, whereas Ford lags far behind, down 4.2%.
Picture Supply: Zacks Funding Analysis
Ford Faces High quality Points
Ford’s wrestle to handle guarantee bills has been one other sore spot for the automaker. High quality points in a number of fashions from 2016-2021 have led to an $800 million enhance in guarantee prices. Although administration intends to handle these points, they’ve communicated to shareholders that the issues might not be resolved for greater than a 12 months, on the very least. In different phrases, the guarantee points will trigger a bearish overhang within the inventory for the foreseeable future.
Backside Line
Regardless of its storied historical past, Ford Motor faces important headwinds, together with missed earnings, slowing EV demand, and elevated competitors from Tesla and different automakers. Moreover, persistent high quality points will doubtless weigh on the inventory over the approaching months.
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Ford Motor Company (F) : Free Stock Analysis Report
Toyota Motor Corporation (TM) : Free Stock Analysis Report
General Motors Company (GM) : Free Stock Analysis Report
Tesla, Inc. (TSLA) : Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the creator and don’t essentially replicate these of Nasdaq, Inc.
