On Oct 8, 2013, Zacks Investment Research upgraded
Ford Motor Co.
) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
Earlier this week, Ford announced plans to increase its global
manufacturing capacity. The company aims to boost capacity by 30%
by 2017 by running three shifts daily at most of its plants.
Additionally, the automaker plans to increase its average
production at all its plants to over 4 from 3 at present.
Ford is pursuing a major expansion plan in the mature and
emerging markets, primarily Argentina, Brazil, China, India and
Thailand. The company expects the Asia-Pacific region to account
for 70% of its global growth in this decade, mostly from China
and India. The region is also likely to account for 40% of its
vehicle sales in the next four to five years. As part of its
expansion strategy, Ford recently inaugurated its first
authorized Ford dealership in Myanmar.
Ford's accelerated product transformation plan "One Ford" is
positively impacting the company. The foremost mission is to
produce common vehicle models for all of its global segments
within five years from now. Another key objective of the plan is
to shift focus from trucks to small cars and deliver more
vehicles from fewer core platforms. Ford already renewed 70% of
its product line-up along with a few discontinuations and has
planned several new launches under the "One Ford" plan.
Ford reported positive earnings surprise in the last 4
quarters with an average beat of 20.52%. The company posted an
impressive 50% rise in earnings per share to 45 cents in the
second quarter of 2013 from 30 cents in the same quarter of 2012
(all excluding special items). With this, Ford surpassed the
Zacks Consensus Estimate of 37 cents.
Revenues in the quarter grew 14.4% to $38.1 billion, exceeding
the Zacks Consensus Estimate of $35.4 billion. The improvement
was attributable to increased wholesale volumes in automotive
business and higher market share in all the regions.
Currently, the Zacks Consensus Estimate for Ford's 2013
earnings stands at $1.55 per share, up 9.57% over 2012. The
estimate for 2014 is $1.77 per share, up 14.78% from the prior
Other Stocks to Consider
Other major automobile stocks worth considering are
General Motors Company
Fuji Heavy Industries Ltd.
). While Daimler and Fuji carry a Zacks Rank #1 (Strong Buy),
General Motors carries a Zacks Rank #2 (Buy).
DAIMLER AG (DDAIF): Get Free Report
FORD MOTOR CO (F): Free Stock Analysis Report
FUJI HEAVY ADR (FUJHY): Get Free Report
GENERAL MOTORS (GM): Free Stock Analysis
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