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Ford (F) Beats on Q3 Earnings, Ups '21 View, Reinstates Dividend
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Ford (F - Free Report) reported adjusted earnings of 51 cents per share for third-quarter 2021, surpassing the Zacks Consensus Estimate of 28 cents. Higher-than-expected profits, primarily in North America and South America markets, led to this outperformance. The bottom line, however, compares unfavorably with year-ago quarter’s earnings of 65 cents per share. The company’s consolidated third-quarter revenues came in at $35,683 million, down 4.8% year over year.
Shares of the company rallied more than 8.5% in after-hours trading yesterday, as the U.S. auto giant managed to beat the earnings projection for the third quarter of 2021. Investors were also encouraged as the company raised its full-year 2021 guidance for the second time this year, citing robust projections for the fourth quarter, including an increase in wholesale shipments from the third quarter, combined with a continued healthy mix of vehicles sold and net pricing.
Ford also announced the decision to reinstate its regular dividend starting from the fourth quarter, more than a year and a half after suspending the payments on account of the coronavirus pandemic. The company will pay a fourth-quarter dividend of 10 cents per share on Dec 1, to shareholders as of Nov 19, 2021.
Ford Motor Company Price, Consensus and EPS Surprise
For the third quarter, the total wholesale volume in the Ford Automotive segment dropped 14% year over year to 1,012,000 units but surpassed the consensus mark of 966,000 units. Revenues of the segment slid 4% year over year to $33.2 billion but outpaced the Zacks Consensus estimate of $31.7 billion. Earnings before interest and taxes came in at $2,459 million, lower than the year-ago earnings of $2,665 million.
In North America, revenues dropped 5% year on year to $24 billion for the reported quarter. The metric, however, surpassed the Zacks Consensus Estimate of $22.9 billion. The wholesale volume declined 16% from the year-earlier quarter to 546,000 units. The EBIT totaled $2,423 million, lower than the earnings of $3,202 million in the corresponding quarter of 2020, but beating the consensus mark of 1,671 million.
In South America, revenues edged down 1% year over year to $0.6 billion for the third quarter but topped the consensus mark of $0.5 billion. The wholesale volume plunged 60% from the year-ago quarter to 20,000 units but marginally exceeded the consensus mark of 19,600 units. The unit’s pretax earnings improved to $2 million, turning around the loss of $108 million reported in the prior-year quarter amid cost-cut and rejig efforts. The reported EBIT also beat the consensus mark of a loss of $84 million.
In Europe, revenues jumped 7% year on year to $6.1 billion for the September-end quarter, but marginally lagged the consensus mark of $6.2 billion. The wholesale volume dipped 9% year over year to 218,000 units and also missed the consensus mark of 221,000 units. The pretax loss for the segment totaled $52 million, narrower than the year-ago loss of $444 million, thanks to the aggressive restructuring initiatives. The reported loss is also narrower than the consensus mark of a loss of $228 million.
In China, revenues plummeted 41% year over year to $0.6 billion for the reported quarter. The wholesale volume edged down 1% from the prior-year figure to 162,000 units. However, the pretax loss narrowed from the prior year’s $57 million to $39 million.
In the International Markets Group, revenues were down 7% from the year-ago figure to $1.9 billion. The wholesale volume slid 13% from the prior-year level to 66,000 units and pretax earnings totaled $125 million, higher than the $72 million reported in the year-ago period.
The third-quarter revenues from the Ford Credit unit declined 12.3% year over year to $2,434 million, missing the Zacks Consensus Estimate of $2,782 million. The pretax earnings totaled $1,077 million, lower than the $1,123 million reported in the comparable last year and missed the consensus mark of $1,129 million.
Revenues from Ford Mobility came in at $38 million, surging from the year-earlier level of $17 million.
Financial Position
Ford reported adjusted free cash flow (FCF) of $7,743 million during the quarter, higher than the prior-year quarter’s FCF of $6,558 million. It had cash and cash equivalents of $27,429 million as of Sep 30, 2021 compared with $25,243 million on Dec 31, 2020. The automotive long-term debt increased to $23,767 million on Sep 30, 2021 from $22,633 million as of the end of 2020.
Guidance
Ford — which shares space with auto biggies including General Motors (GM - Free Report) , Tesla (TSLA - Free Report) and Volkswagen (VWAGY - Free Report) — raised the EBIT guidance for 2021. The Zacks Rank #4 (Sell) company now forecasts the current-year EBIT within $10.5-$11.5 billion, higher than the prior view of $9-$10 billion. Ford’s guidance for the full-year adjusted FCF remains intact within the range of $4-$5 billion. Management projects that commodity costs to flare up $3-$3.5 billion in the ongoing year, and another $1.5 billion in 2022. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The company expects to outlay $40-$45 billion in strategic capital expenditures between 2020 and 2025, including one-half of the more than the $30 billion which it plans to commit exclusively to BEVs during that period.
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Ford (F) Beats on Q3 Earnings, Ups '21 View, Reinstates Dividend
Ford (F - Free Report) reported adjusted earnings of 51 cents per share for third-quarter 2021, surpassing the Zacks Consensus Estimate of 28 cents. Higher-than-expected profits, primarily in North America and South America markets, led to this outperformance. The bottom line, however, compares unfavorably with year-ago quarter’s earnings of 65 cents per share. The company’s consolidated third-quarter revenues came in at $35,683 million, down 4.8% year over year.
Shares of the company rallied more than 8.5% in after-hours trading yesterday, as the U.S. auto giant managed to beat the earnings projection for the third quarter of 2021. Investors were also encouraged as the company raised its full-year 2021 guidance for the second time this year, citing robust projections for the fourth quarter, including an increase in wholesale shipments from the third quarter, combined with a continued healthy mix of vehicles sold and net pricing.
Ford also announced the decision to reinstate its regular dividend starting from the fourth quarter, more than a year and a half after suspending the payments on account of the coronavirus pandemic. The company will pay a fourth-quarter dividend of 10 cents per share on Dec 1, to shareholders as of Nov 19, 2021.
Ford Motor Company Price, Consensus and EPS Surprise
Ford Motor Company price-consensus-eps-surprise-chart | Ford Motor Company Quote
Segmental Performance
For the third quarter, the total wholesale volume in the Ford Automotive segment dropped 14% year over year to 1,012,000 units but surpassed the consensus mark of 966,000 units. Revenues of the segment slid 4% year over year to $33.2 billion but outpaced the Zacks Consensus estimate of $31.7 billion. Earnings before interest and taxes came in at $2,459 million, lower than the year-ago earnings of $2,665 million.
In North America, revenues dropped 5% year on year to $24 billion for the reported quarter. The metric, however, surpassed the Zacks Consensus Estimate of $22.9 billion. The wholesale volume declined 16% from the year-earlier quarter to 546,000 units. The EBIT totaled $2,423 million, lower than the earnings of $3,202 million in the corresponding quarter of 2020, but beating the consensus mark of 1,671 million.
In South America, revenues edged down 1% year over year to $0.6 billion for the third quarter but topped the consensus mark of $0.5 billion. The wholesale volume plunged 60% from the year-ago quarter to 20,000 units but marginally exceeded the consensus mark of 19,600 units. The unit’s pretax earnings improved to $2 million, turning around the loss of $108 million reported in the prior-year quarter amid cost-cut and rejig efforts. The reported EBIT also beat the consensus mark of a loss of $84 million.
In Europe, revenues jumped 7% year on year to $6.1 billion for the September-end quarter, but marginally lagged the consensus mark of $6.2 billion. The wholesale volume dipped 9% year over year to 218,000 units and also missed the consensus mark of 221,000 units. The pretax loss for the segment totaled $52 million, narrower than the year-ago loss of $444 million, thanks to the aggressive restructuring initiatives. The reported loss is also narrower than the consensus mark of a loss of $228 million.
In China, revenues plummeted 41% year over year to $0.6 billion for the reported quarter. The wholesale volume edged down 1% from the prior-year figure to 162,000 units. However, the pretax loss narrowed from the prior year’s $57 million to $39 million.
In the International Markets Group, revenues were down 7% from the year-ago figure to $1.9 billion. The wholesale volume slid 13% from the prior-year level to 66,000 units and pretax earnings totaled $125 million, higher than the $72 million reported in the year-ago period.
The third-quarter revenues from the Ford Credit unit declined 12.3% year over year to $2,434 million, missing the Zacks Consensus Estimate of $2,782 million. The pretax earnings totaled $1,077 million, lower than the $1,123 million reported in the comparable last year and missed the consensus mark of $1,129 million.
Revenues from Ford Mobility came in at $38 million, surging from the year-earlier level of $17 million.
Financial Position
Ford reported adjusted free cash flow (FCF) of $7,743 million during the quarter, higher than the prior-year quarter’s FCF of $6,558 million. It had cash and cash equivalents of $27,429 million as of Sep 30, 2021 compared with $25,243 million on Dec 31, 2020. The automotive long-term debt increased to $23,767 million on Sep 30, 2021 from $22,633 million as of the end of 2020.
Guidance
Ford — which shares space with auto biggies including General Motors (GM - Free Report) , Tesla (TSLA - Free Report) and Volkswagen (VWAGY - Free Report) — raised the EBIT guidance for 2021. The Zacks Rank #4 (Sell) company now forecasts the current-year EBIT within $10.5-$11.5 billion, higher than the prior view of $9-$10 billion. Ford’s guidance for the full-year adjusted FCF remains intact within the range of $4-$5 billion. Management projects that commodity costs to flare up $3-$3.5 billion in the ongoing year, and another $1.5 billion in 2022. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The company expects to outlay $40-$45 billion in strategic capital expenditures between 2020 and 2025, including one-half of the more than the $30 billion which it plans to commit exclusively to BEVs during that period.