Ford Gears Up for Q4 Earnings Report Amidst Market Challenges
Ford Motor Company (F), located in Dearborn, Michigan, is a major player in the automotive industry. Known for its wide range of vehicles, including trucks, SUVs, and Lincoln luxury cars, the company is valued at $38.8 billion by market capitalization. In addition to manufacturing, Ford also offers vehicle financing, leasing, and insurance services. The company is scheduled to announce its fiscal fourth-quarter earnings for 2024 after the market closes on Wednesday, February 5.
Analysts Predict Mixed Results for Upcoming Earnings
Before the earnings announcement, analysts project that Ford will report a profit of $0.34 per share on a diluted basis. This marks a 17.2% increase from $0.29 per share in the same quarter last year. Historically, Ford has either exceeded or matched expectations in three of the last four quarters while falling short in one instance.
Full-Year Expectation Shows Declining Earnings
Looking at the full fiscal year, analysts predict an earnings per share (EPS) of $1.77 for Ford, a decline of 11.9% from the previous year’s $2.01. They also expect EPS to drop 3.4% year over year to $1.71 in fiscal 2025.
Stock Performance Lags Behind Major Indices
Over the past 52 weeks, Ford’s stock has greatly underperformed compared to the S&P 500 ($SPX), which has gained 24.2%. Ford shares are down 18.6% during this period, and the company similarly lagged behind the Consumer Discretionary Select Sector SPDR Fund (XLY), which rose by 27%.
Challenges and Competition Impacting Ford’s Growth
Ford’s struggles are attributed to slowing growth, decreasing demand, and increasing market competition. The company is currently facing issues such as higher inventories, rising warranty costs, inflation pressures, and uncertainty in its European operations. Additionally, Ford’s electric vehicle strategy is feeling the heat from fierce competition and significant development expenses.
Recent Earnings Beat Reflects Potential Recovery
On October 28, Ford’s shares saw a more than 2% increase following the announcement of its Q3 results. The adjusted EPS of $0.49 surpassed Wall Street’s expectations of $0.47, while revenues reached $46.2 billion, exceeding forecasts of $42.3 billion.
Analyst Ratings Indicate Cautious Outlook
Currently, analysts hold a cautious stance on Ford stock, giving it an overall “Hold” rating. Among 19 analysts covering the company, four recommend a “Strong Buy,” 10 suggest a “Hold,” one indicates a “Moderate Sell,” and four advise a “Strong Sell.” The average price target for Ford stands at $11.24, suggesting a potential upside of 15.4% from current levels.
On the date of publication,
Neha Panjwani
did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more information, please view the Barchart Disclosure Policy
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
