Ford Motor Co.
) is set to report second-quarter 2014 results on Jul 24. Last
quarter, it posted a negative 21.87% earnings surprise. However,
the automaker managed to beat earnings by an average of 7.22% over
the last four quarters. Let us see how things are shaping up for
Factors Affecting the Past Quarter
Ford's sales in the U.S. fell 1.8% in the first half of 2014,
which is in line the company's expectation of lower 2014 pre-tax
profit from the region as compared with 2013. However, sales in
China surged 35% year over year in the first half, keeping the
company on track to surpass the pre-tax profits of 2013. Even the
sales in Europe, which has been incurring losses over recent
quarters, improved 6.6% year over year in the first half of
The sales volumes in various regions will significantly affect
Ford's second-quarter earnings. Moreover, structural costs are
expected to rise during the quarter due to the ongoing revamp of
the product lineup. Further, Ford expects a significant loss from
South America in the second quarter of 2014 due to low sales
volumes and change in the Venezuelan currency's exchange rate.
Our proven model does not conclusively show that Ford is likely
to beat earnings this quarter. That is because a stock needs to
have both a positive
and a Zacks Rank of #1, 2 or 3 for this to happen. That is not the
case here as you will see below.
Ford has an earnings ESP of 0.00%. That is because the Most
Accurate estimate and the Zacks Consensus Estimate are both at 37
cents per share.
Ford's Zacks Rank #3 (Hold) when combined with an ESP of 0.00%
makes surprise prediction difficult.
We caution against stocks with Zacks Rank #4 and 5 (Sell-rated
stocks) going into the earnings announcement, especially when the
company is seeing negative estimate revisions momentum.
Other Stocks to Consider
Here are some companies in the automobile sector you may want to
consider as our model shows these have the right combination of
elements to post an earnings beat this quarter:
) has Earnings ESP of +2.08% and a Zacks Rank #1 (Strong Buy).
Gentex will report second-quarter 2014 earnings on Jul 24,
) has Earnings ESP of +6.67% and a Zacks Rank #2 (Buy). It will
release second-quarter earnings results on Jul 31, 2014.
Dana Holding Corporation
) has Earnings ESP of +5.77% and a Zacks Rank #2. The company will
post second-quarter earnings on Jul 24, 2014.
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FORD MOTOR CO (F): Free Stock Analysis Report
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