Ford swings to quarterly profit, guidance kept unchanged; stock slips

Ford swings to quarterly profit, guidance kept unchanged; stock slips

Ford Motor Co. late Tuesday swung to a quarterly profit and reported a 20% rise in sales, but the stock fell 1.4% in the extended session as Wall Street seemed to question Ford’s unchanged guidance.

Ford (F) “delivered a solid quarter while making real progress on our Ford+ growth plan,” Chief Executive Jim Farley said in a call with analysts following results.

“I hope that becomes a trend at Ford, boringly predictable” on execution but “dynamic in creating the Ford of the future,” Farley said, adding that Ford views its EV business, which posted a quarterly loss, as operating as a startup.

Ford earned $1.8 billion, or 44 cents a share, in the first quarter, contrasting with a loss of $3.1 billion, or 78 cents a share, in the year-ago period. Adjusted for one-time items, Ford earned 63 cents a share.

Revenue rose 20% to $41.5 billion, the company said. Analysts polled by FactSet expected adjusted earnings of 38 cents a share on sales of $34.5 billion.

Ford also reaffirmed its 2023 guidance of adjusted EBIT of $9 billion to $11 billion, and adjusted free-cash flow of about $6 billion.

Ford shares ended the regular trading day down 2.2%.

“Ford’s top and bottom line both came in well ahead of consensus,” but investors may be questioning why Ford didn’t raise its full-year guidance following the much-stronger-than-expected quarterly results, CFRA analyst Garrett Nelson said.

“Ford is likely just being conservative given current economic uncertainties,” but investors may be more unforgiving, he said, as they may view it as a bearish signal for the remaining quarters.

Tuesday’s earnings “helps renew confidence in the story following a sizeable fourth-quarter miss,” Nelson said. “We continue to like Ford’s combination of growth and yield at these levels and remain confident in CEO Jim Farley’s ability to execute a calculated EV growth strategy.”

As expected, Ford reported earnings by its segments: Ford Blue, encompassing gas and hybrid vehicles; Ford Model e, or electric vehicles; and Ford Pro, which covers commercial products and services. Ford Model e saw a EBIT loss of $722 million in the quarter.

Ford earlier Tuesday said it was re-opening its order books for the Mustang Mach E and planning to ramp up production of the all-electric SUV in the second half of the year. Ford also cut Mach E prices.

Shares of Ford have lost 17% in the past 12 months, compared with a drop of about 0.9% for the S&P 500 index . So far this year, however, Ford shares have gained 1.5%, compared with gains of 1.6% for S&P 500 in the same period.

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