Is Ford Back on Track After This Q3 Earnings Beat?

Cars and Drivers

Published: October 28, 2020 4:43 pm

Ford Motor Co. (NYSE: F) reported its third quarter financial results after the markets closed on Wednesday. The auto giant posted $0.65 in earnings per share (EPS) and $37.5 billion in revenue, which compares with consensus estimates that called for $0.16 in EPS and $32.86 billion in revenue. The same period from last year had $0.34 in EPS and $33.93 billion in revenue.

For the third quarter, management noted that Ford produced solid results through a combination of great operating execution; benefits from focusing on its strengths in high-demand, profitable vehicles; and a reversal of business effects from the coronavirus pandemic.

In terms of its segment, Ford reported:

Automotive revenues increased 2.3% year over year to $34.71 billion.
Ford Credit revenue decreased 8.9% to $2.77 billion.
Mobility revenue increased by 6 million from last year to a total of $20 million.

Ford generated $6.3 billion in adjusted free cash flow during the third quarter. On the books, cash, cash equivalents, and marketable securities totaled $44.83 billion at the end of the quarter, versus $34.65 at the end of the previous fiscal year.

Looking ahead to the fourth quarter, Ford expects adjusted EBIT to be between break-even and a $500 million loss, down from both the third quarter and year ago period. Outside of this, Ford said that it expects to see temporarily lower wholesale shipments of F-150—about 100,000 units—reflecting a measured production ramp-up. Consensus estimates are calling for a net loss of $0.14 per share and $33.11 billion in revenue for the coming quarter.

Ford stock closed Wednesday at $7.70, with a 52-week range of $3.96 to $9.57. The consensus analyst price target is $7.96. Following the announcement, the stock was up 5% at $8.12 in the after-hours session.

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