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Ford (F) Q2 Earnings Top Estimates, Dividend Hiked to 15 Cents
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Ford Motor Co. (F - Free Report) reported adjusted earnings of 68 cents per share in second-quarter 2022, topping the Zacks Consensus Estimate of 43 cents. Higher-than-expected profits in its North America, South America and Europe segments led to this outperformance. The bottom line jumped significantly from the year-ago quarter’s earnings of 13 cents. The company’s consolidated second-quarter revenues came in at $40.2 billion, surging 50.2% year over year.
Segmental Performance
In the second quarter, the total wholesale volume in the Ford Automotive segment significantly increased 35% year over year to 1,032,000 units and topped the consensus metric of 988,000 units. Revenues from the segment surged 57.3% to $37.9 billion and outpaced the Zacks Consensus estimate of $33 billion. Earnings before interest and taxes came in at $3,322 million, reversing from the year-ago loss of $95 million and beating the consensus metric of $1,860 million.
In North America, revenues surged 94% year over year to $29.1 billion in the reported quarter and beat the consensus metric of $23.4 billion. The wholesale volume jumped 89% to 618,000 units and crossed the consensus metric of 542,000 units. EBIT totaled $3,269 million, a massive increase from $194 million in the corresponding quarter of 2021. The figure topped the consensus mark of $1,876 million.
In South America, revenues moved up 29% year over year to $0.7 billion in the quarter. However, the figure lagged the consensus mark of $0.94 billion. Wholesale volume increased 3% to 18,000 units. The figure, however, lagged the consensus mark of 27,370 units. The unit’s pretax earnings came in at $104 million against a loss of $86 million in the prior-year quarter benefiting from restructuring efforts. It also crossed the consensus mark of $52 million.
In Europe, revenues inched up 3% year over year to $5.8 billion in the quarter but lagged the consensus mark of $6.02 billion. Wholesale volume increased 22% to 222,000 units and crossed the consensus mark of 217,000 units. Pretax earnings for the segment totaled $10 million, reversing from the year-ago loss of $284 million. The consensus mark was pegged at a loss of $56 million.
In China, revenues plummeted 20% year over year to $0.4 billion in the reported quarter and lagged the consensus mark of $0.49 billion. Wholesale volume also plunged 24% to 114,000 units and lagged the consensus metric of 130,000 units. The pretax loss narrowed slightly from the prior year’s loss of $123 million to $121 million. The loss was wider than the consensus mark of $109 million.
In the International Markets Group, revenues were down 21% from the year-ago figure to $2 billion and lagged the consensus mark of $2.11 billion. Wholesale volume slid 32% to 59,000 units and lagged the consensus metric of 72,000 units. Pretax earnings totaled $60 million, falling steeply from $204 million reported in the year-ago period and missed the consensus metric of $97 million.
Second-quarter revenues from the Ford Credit unit came in at $2,256 million, 13.3% lower than the year-ago revenues of $2,603 million and missing the Zacks Consensus Estimate of $2,393 million. Pretax earnings totaled $939 million, falling from $1,623 million in the year-ago quarter and lagging the consensus mark of $1,099 million.
Revenues from Ford Mobility came in at $25 million, increasing from the year-earlier level of $21 million but missing the consensus estimate of $57 million.
Financial Position
Ford reported adjusted free cash flow (FCF) of $3,619 million during the quarter. It had cash and cash equivalents of $19.5 billion as of Jun 30, 2022, compared with $20.5 billion on Dec 31, 2021. The automotive long-term debt increased to $17,833 million from $17,200 million as of the end of 2021. Riding on its financial strength, Ford raised its dividend of 15 cents per share. The dividend is payable on Sep 1 to shareholders of record at the close of business on Aug 11.
Guidance
Ford’s 2022 projections remain unchanged. Adjusted EBIT for 2022 is between $11.5 billion and $12.5 billion. Adjusted FCF is envisioned in the range of $5.5-6.5 billion for 2022. The company’s assumption of growth of 10% to 15% in vehicle wholesale volumes for 2022 remains the same. However, it anticipates headwinds from commodity prices to the tune of $4 billion in 2022.
American Axle has an expected earnings growth rate of 80.7% for 2023. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
American Axle’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters. AXL pulled off a trailing four-quarter earnings surprise of 847.92%, on average. The stock has declined 10.7% over the past year.
LCI Industries has an expected earnings growth rate of 65.9% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
LCI Industries’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. LCII pulled off a trailing four-quarter earnings surprise of 21.81%, on average. The stock has declined 13.5% in the past year.
Standard Motor has an expected earnings growth rate of 5.2% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
Standard Motor’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. SMP pulled off a trailing four-quarter earnings surprise of 40.34%, on average. The stock has risen 7.8% over the past year.
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Ford (F) Q2 Earnings Top Estimates, Dividend Hiked to 15 Cents
Ford Motor Co. (F - Free Report) reported adjusted earnings of 68 cents per share in second-quarter 2022, topping the Zacks Consensus Estimate of 43 cents. Higher-than-expected profits in its North America, South America and Europe segments led to this outperformance. The bottom line jumped significantly from the year-ago quarter’s earnings of 13 cents. The company’s consolidated second-quarter revenues came in at $40.2 billion, surging 50.2% year over year.
Segmental Performance
In the second quarter, the total wholesale volume in the Ford Automotive segment significantly increased 35% year over year to 1,032,000 units and topped the consensus metric of 988,000 units. Revenues from the segment surged 57.3% to $37.9 billion and outpaced the Zacks Consensus estimate of $33 billion. Earnings before interest and taxes came in at $3,322 million, reversing from the year-ago loss of $95 million and beating the consensus metric of $1,860 million.
In North America, revenues surged 94% year over year to $29.1 billion in the reported quarter and beat the consensus metric of $23.4 billion. The wholesale volume jumped 89% to 618,000 units and crossed the consensus metric of 542,000 units. EBIT totaled $3,269 million, a massive increase from $194 million in the corresponding quarter of 2021. The figure topped the consensus mark of $1,876 million.
In South America, revenues moved up 29% year over year to $0.7 billion in the quarter. However, the figure lagged the consensus mark of $0.94 billion. Wholesale volume increased 3% to 18,000 units. The figure, however, lagged the consensus mark of 27,370 units. The unit’s pretax earnings came in at $104 million against a loss of $86 million in the prior-year quarter benefiting from restructuring efforts. It also crossed the consensus mark of $52 million.
In Europe, revenues inched up 3% year over year to $5.8 billion in the quarter but lagged the consensus mark of $6.02 billion. Wholesale volume increased 22% to 222,000 units and crossed the consensus mark of 217,000 units. Pretax earnings for the segment totaled $10 million, reversing from the year-ago loss of $284 million. The consensus mark was pegged at a loss of $56 million.
In China, revenues plummeted 20% year over year to $0.4 billion in the reported quarter and lagged the consensus mark of $0.49 billion. Wholesale volume also plunged 24% to 114,000 units and lagged the consensus metric of 130,000 units. The pretax loss narrowed slightly from the prior year’s loss of $123 million to $121 million. The loss was wider than the consensus mark of $109 million.
In the International Markets Group, revenues were down 21% from the year-ago figure to $2 billion and lagged the consensus mark of $2.11 billion. Wholesale volume slid 32% to 59,000 units and lagged the consensus metric of 72,000 units. Pretax earnings totaled $60 million, falling steeply from $204 million reported in the year-ago period and missed the consensus metric of $97 million.
Second-quarter revenues from the Ford Credit unit came in at $2,256 million, 13.3% lower than the year-ago revenues of $2,603 million and missing the Zacks Consensus Estimate of $2,393 million. Pretax earnings totaled $939 million, falling from $1,623 million in the year-ago quarter and lagging the consensus mark of $1,099 million.
Revenues from Ford Mobility came in at $25 million, increasing from the year-earlier level of $21 million but missing the consensus estimate of $57 million.
Financial Position
Ford reported adjusted free cash flow (FCF) of $3,619 million during the quarter. It had cash and cash equivalents of $19.5 billion as of Jun 30, 2022, compared with $20.5 billion on Dec 31, 2021. The automotive long-term debt increased to $17,833 million from $17,200 million as of the end of 2021. Riding on its financial strength, Ford raised its dividend of 15 cents per share. The dividend is payable on Sep 1 to shareholders of record at the close of business on Aug 11.
Guidance
Ford’s 2022 projections remain unchanged. Adjusted EBIT for 2022 is between $11.5 billion and $12.5 billion. Adjusted FCF is envisioned in the range of $5.5-6.5 billion for 2022. The company’s assumption of growth of 10% to 15% in vehicle wholesale volumes for 2022 remains the same. However, it anticipates headwinds from commodity prices to the tune of $4 billion in 2022.
Zacks Rank & Key Picks
F carries a Zacks Rank #4 (Sell), currently.
Better-ranked players in the auto space include American Axle & Manufacturing Holdings (AXL - Free Report) , LCI Industries (LCII - Free Report) and Standard Motor Products (SMP - Free Report) , each carrying a Zacks Rank #2 (Buy), currently. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
American Axle has an expected earnings growth rate of 80.7% for 2023. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
American Axle’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters. AXL pulled off a trailing four-quarter earnings surprise of 847.92%, on average. The stock has declined 10.7% over the past year.
LCI Industries has an expected earnings growth rate of 65.9% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
LCI Industries’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. LCII pulled off a trailing four-quarter earnings surprise of 21.81%, on average. The stock has declined 13.5% in the past year.
Standard Motor has an expected earnings growth rate of 5.2% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
Standard Motor’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. SMP pulled off a trailing four-quarter earnings surprise of 40.34%, on average. The stock has risen 7.8% over the past year.