24/7 Wall St. Insights
- If Ford Motor Co. (NYSE: F) surprises Wall Street with third-quarter results, shares will almost certainly rally to above $12.
- If it disappoints, the stock will almost certainly sell down to $10.
- Also: Dividend legends to hold forever.
In the third quarter of last year, Ford Motor Co. (NYSE: F) had revenue of $43.8 billion. Its per-share earnings were $0.30 ($0.39 non-GAAP). Ford management said it had lost $100 million in production during the quarter. Its troubled Model e EV segment had an EBIT loss of $1.3 billion. Ford will need to improve in the quarter it is about to announce.
According to Yahoo Finance, the average analyst expectation for third-quarter revenue is $41.9 billion, and the average EPS estimate is $0.47. If Ford beats those handily, its shares, down 9% this year compared to the S&P 500’s increase of 23%, will almost certainly rally to above $12. The price is $11.7 now.
If Ford misses the anticipated numbers badly and its EV business posts another huge loss, the stock will almost certainly sell down to $10.
Ford has three hurdles when it announces its numbers. The first is that warranty losses are low—it has been plagued by a high figure. The next is that its EV business improves financially, and the last is the extent to which the UAW has damaged its numbers.
Ford has a fighting chance at a good quarter. If its EV losses have improved, and it signals a good fourth quarter, Wall Street’s impression of the company could change.
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