Ford stock jumps after stronger-than-hoped earnings, 2024 forecast

Ford stock jumps after stronger-than-hoped earnings, 2024 forecast

ford motor (F) gave a strong outlook for 2024 late Tuesday after reporting better-than-feared earnings for a fourth quarter marred by an auto workers’ strike.

Japanese competitor toyota motor (TM) on Tuesday forecast record profits, driven by gas-electric hybrid vehicles. Ford stock rose in extended trading Tuesday.


Ford profits

Estimates: Analysts, on average, expected earnings per share to fall 73% to 12 cents, according to FactSet. Revenues saw a 2% decline year over year to $43.062 billion.

United Auto Workers strike against Ford General Motors (JM) W excellent (STLA) expired on October 30, as the auto giants made costly concessions.

results: Ford earnings of 29 cents per share, down 43%, on revenue of $46 billion, up 4.5%. This marked Ford’s first profit decline in five quarters.

The automaker declared regular and additional dividends of 15 and 18 cents per share, respectively, during the first quarter.

Prospects: The automaker late Tuesday guided for 2024 adjusted EBIT of $10 billion-$12 billion, above the FactSet consensus view of $9.650 billion. It also expects above-consensus free cash flow (FCF) of between $6 billion and $7 billion.

Rival General Motors on January 30 gave a bullish forecast.

Ford stock performance

Ford Motor Company shares rose 6.3% to 12.85 in late trading. F stock rose 4.3% on the stock market today.

Ford stock encountered resistance at its 200-day moving average after reclaiming the 50-day line in late January. A move back above the 200-day line could represent an early entry for risk-tolerant investors.

GM shares and STLA shares posted gains in the 1%-2% range. Stellantis reports Q4 on February 15.

Toyota stock rose 7.7% on Tuesday. Toyota expects to achieve a record net profit of $30.3 billion for the fiscal year ending in March, thanks to rising global sales of hybrid vehicles. The move sent TM stock nearly 14% above its 194.43 buy point after the breakout in January.

Tesla stock saw a modest rebound on Tuesday, and remains near multi-month lows.

The rise of hybrid electric vehicles, the slowdown of battery electric vehicles

Legacy automakers continue to scale back their big bets on “pure” or battery electric vehicles (BEVs). They report demand for hybrid vehicles is growing, while industry-wide EV sales growth has slowed.

In January, Ford’s hybrid electric vehicle sales continued to boost its overall new vehicle sales, continuing the momentum seen in the fourth quarter of 2023.

Amid record hybrid sales, Ford’s 2023 sales totaled 1,995,912 vehicles — up 7% from 2022 and the best since 2020, capped by slight gains in the fourth quarter despite the labor strike. Combustion vehicles still make up 90% of total 2023 sales.

Industry observers say that while many customers are interested in purchasing battery electric vehicles, they are not willing to pay premiums for them compared to gas-powered or hybrid vehicles. Ford said that hurt electric vehicle prices and profitability.

GM is now bringing back hybrids, hedging its previous pursuit of all-electric vehicles.

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