Ford Motor Co. (
) shares are trading higher ahead of the company's fourth quarter
earnings announcement, expected out before the market opens
tomorrow. Shares are up2.4% today.
F is expected to report EPS of $0.48 on revs of $30.57 billion.
Last quarter, the Dearborn, MI-based automaker posted EPS of $0.48
on revs of $29 billion, topping the Street consensus looking for
EPS of $0.38 and revs of $27.83 billion. Looking at Q409, we see
that Ford reported EPS of $0.43 coupled with revs of $35.4 billion,
again, both beating the consensus estimates.
Shares gained 40.7% through the quarter to $17.25 at the end of
December. The stock is up 9.1% since then, and finished 2010 up
A simple valuation puts Ford with a forward P/E of 8.6x FY11 EPS
estimates, compared to 9.1x for General Motors (
), 20x for Toyota (
), and 13.4x at Honda Motor (
Data from Bloomberg has 11 analysts with a Buy on F, 6 with a hold,
and one suggesting to Sell. The analyst price target average is
$20, with a high of $23 and low of $17. Shares have traded in a
range of $18.97 - $9.75 over the last 52-weeks.
- Deutsche Bank is looking for EPS of $0.42, but sees upside to
their estimate, anticipating a more in-line report to the Street
consensus. Upside may come from North America, Ford Credit, and a
lower-than-expected tax rate.
DB notes that a key area of focus may be margins going forward.
Though Ford has already forecast flat margins Y/Y, Deutsche
believes that this may be a little conservative. Pricing and
purchased material costs will be on the forefront of their mind
this earnings season for Ford. Checks have tires and
semiconductors as specific areas of potential increased costs
moving into FY11.
Incentives have largely been benign from Q409.
Downside risks include: 1) lower-than-expected trajectory of U.S.
demand; 2) slower than expected economic recovery; 3) higher-than
expected cost increases, potentially due to commodity inflation
and/or higher-than forecast growth in engineering / R&D
expenses; 4) higher-than-expected cost increases resulting from
2011 UAW contract negotiations.
Deutsche has a Buy on the stock, with a $21.50 price target.
- Soleil is lookng for EPS of $0.54, which excludes a one-time
charge of 1 billion, about $0.25, related to note conversion.
Ford should end FY10 with a positive net cash balance of about $1
billion. Soleil also expects surplus to build in FY11 and FY12.
Soleil currently has a Buy rating with $22 price target on the
Not too long ago, Ford also estimated that FY11 sales could exceed
13 million units in the U.S. for automakers.
Should Ford be able to meet Wall Street expectations, it would mark
the best year for the company since 1999, in an environment that is
arguably unfavorable: high-unemployment, tight credit, an apathetic
housing market, and rising commodities prices.
Ford is expected to release their Q411 earnings on Friday, January
28, 2011, at approximately 7:00am EST. Stay tuned to
section to see our analysis of the highly-anticipated quarterly
results withi0 n seconds of their release.