Why Ford’s February Sales Were Good News Even Though Volume Is Down

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Ford Motor Co. (NYSE: F) on Wednesday reported a U.S. sales decrease of 4% in February, to 208,440 Ford and Lincoln vehicles, compared with February 2016 sales of 217,912. Truck sales rose 3.9% for the month, and sales of F Series pickups increased by 8.7%. Retail sales declined 3% in February to 134,576.

Total sales compare to an estimate of 204,000 by analysts at Kelley Blue Book (KBB), who also estimated an average transaction price of $38,601, up 5.5% year over year and down 1.3% compared with January’s average selling price. KBB transaction prices do not include applied consumer incentives.

The company said its overall average transaction prices rose $1,900 year over year.

Sales of the Ford F-Series pickups rose 8.7% year over year in February to 65,956 units. In January, Ford sold 57,995 F-Series trucks, following a December sales total of 87,512.

Truck sales comprised about 40% of all Ford sales in February, and the F-Series pickups accounted for about 31.6% of total February sales.

Sales of the company’s sport utility vehicles (SUVs) posted a year-over-year increase of 5.9% in February.

Ford Fiesta sales rose 6% year over year and Taurus sales rose 5.3%, but both increases came on a small base. Mustang sales fell 17% and Focus sales fell 31.8%.

Sales of the Lincoln brand rose 8.8% year over year in February, as sales of Lincoln cars jumped 16.2% on sales of the all-new Lincoln Continental. Car sales totaled 3,170 units in the month, and utility vehicle sales totaled 5,574 units. SUV sales rose 4.9% year over year in February.

Higher-than-expected sales and an improved average selling price outweighed the year-over-year decline in unit sales.

Ford’s stock traded up about 1.2% early Wednesday to $12.70, in a 52-week range of $11.07 to $14.22. The 12-month consensus price target is $13.34.