Ford (F) Barely Misses Earnings Estimates, Stock Pays a Sizeable Price
Ford Motor Company (F) more than doubled its third-quarter earnings on a year-over-year basis, though it still fell short of expectations, sending F shares down more than 3% on Tuesday morning.
It was a close one, to be fair. The per-share profit of 45 cents barely missed the 46 cents per share analysts were expecting. Revenue of 35.8 billion, however, topped estimates of $35.09 billion. Had it not been for unexpectedly high taxes, the company would have beaten analysts' outlooks.
North America was the third quarter's bright spot. Third-quarter sales for its North American unit were the strongest they've ever been (any quarter of any year), and even though Ford lost $340 million before taxes in Q3 with its operations outside of North America, the company-wide pretax profit of $2.7 billion was a third-quarter record.
Ford earned on $32.8 billion in sales in the third quarter of 2014... though that's relatively meaningless profit (and even revenue) comparison. In Q3 of last year, several For Motor Company production plants were closed to refit for production of the all new F-series pickup trucks, which not only crimped output but was a costly process in itself. Those factories are now back in operation, and the trucks they're making are in high demand; the F-series of trucks saw an 8% increase in demand. They're a critical aspect of the company's product line, usually accounting for roughly 90% of Ford's profits.
Ford Motor Company now foresees a full-year profit of somewhere between $8.5 billion and $9.5 billion. The range is wide given how near the end of the year is, but with its Asian operation being modestly profitable last quarter and the losses being incurred in South America shrinking quickly, the company isn't willing to paint itself into a corner.
The near-4% slide F is seeing today quells a budding uptrend before it had a chance to get moving in earnest, forming another lower high and extending a bigger-picture downtrend that began in late-2013.
F Daily Chart
