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How is Ford (F) North America Unit Placed Ahead of Q4 Earnings?
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Ford (F - Free Report) is set to release fourth-quarter 2022 results on Feb 2, after the closing bell. With the earnings release around the corner, it's worth taking a look at the company’s U.S. sales during the to-be-reported quarter. Also, we will discuss the key projections of the company’s North America market — which accounts for the bulk of automotive sales.
In the last reported quarter, wholesale unit volumes in the North American segment rose 4% from the year-earlier period to 568,000 units but lagged the consensus metric of 627,000 units. Revenues in the North American segment rose 10% year on year to $26.3 billion in the reported quarter but fell short of the consensus metric of $27.6 billion. Consequently, EBIT totaled $1,309 million, a decrease from $2,423 million in the corresponding quarter of 2021.The figure also missed the consensus mark of $1,955 million.
Things to Note This Time Around
Ford reported fourth-quarter vehicle sales of 483,970 units in the United States, down more than 4% year over year. While SUV sales declined around 11% during the fourth quarter of 2022, sales of trucks inched up 0.6% to 270,064 units. It should be noted that trucks account for the highest sales mix for Ford by the vehicle category and also deliver the biggest profit margin for the auto giant. December marked the best monthly sales of F-series trucks in 2022. Ford sold 75,076 F-Series last month. This augurs well for fourth-quarter revenues from the North America unit. Sales of the maverick truck during the quarter under review jumped to 22,568 units. Ford’s EV sales — comprising Mustang Mach E, E-Transit and F-150 Lightning — rose to 20,339 units in the fourth quarter of 2022. The volumes have not just jumped on a yearly basis, they also increased 11.4% on a sequential basis.
The Zacks Consensus Estimate for wholesale volumes in North America is pegged at 660,000 units, implying an increase from 599,000 units in the year-ago period. Consequently, the consensus mark for revenues from North America is $28.8 million, implying a year-over-year uptick of 11.6%.
While the company is bearing the brunt of commodity cost headwinds stemming from exacerbated supply chain snarls and inflationary pressure, high vehicle prices are offering respite. Ford is passing escalating manufacturing costs to consumers by way of price hikes. During the fourth quarter of 2022, the company raised the price of its popular F-Lightning e-pickup twice citing “ongoing supply chain constraints, rising material costs and other market factors.” In October, it hiked the price of its e-truck by 11%, with the entry-level model starting at $51,974. In December, it again upped its price by $4000 to $55,974.
Ford’s projected wholesale shipments and revenues from the North America segment spark optimism. High vehicle prices are largely offsetting commodity cost inflation, thereby preventing huge margin erosion. The consensus mark for EBIT from the North America segment is pegged at $3,398 million, indicating a jump from $1,822 million.
Ford’s Earnings & Revenue Projections for Q4
The Zacks Consensus Estimate for Ford’s fourth-quarter earnings and automotive revenues is pegged at 59 cents a share and $39.8 billion, respectively.
Investors should note that our proven model does not conclusively predict an earnings beat for Ford this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here. Ford currently has an Earnings ESP of 0.00% and carries a Zacks Rank #5 (Strong Sell).
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
While an earnings beat looks uncertain for Ford, here are a couple of players from the auto space, which, according to our model, have the right combination of elements to post an earnings beat for the quarter to be reported:
Lear (LEA - Free Report) will release fourth-quarter 2022 results on Feb 2, before the opening bell. The company has an Earnings ESP of +2.71% and a Zacks Rank #3.
The Zacks Consensus Estimate for Lear’s to-be-reported quarter’s earnings and revenues is pegged at $2.53 per share and $5.26 billion, respectively. LEA surpassed earnings estimates in the trailing four quarters, with the average surprise being 18%.
Harley-Davidson (HOG - Free Report) is set to report fourth-quarter 2022 results on Feb 2, before market open. The company has an Earnings ESP of +300.00% and a Zacks Rank #2.
The Zacks Consensus Estimate for Harley-Davidson’s to-be-reported quarter’s earnings and revenues is pegged at 3 cents per share and $880.5 million, respectively. HOG surpassed earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 43.3%.
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How is Ford (F) North America Unit Placed Ahead of Q4 Earnings?
Ford (F - Free Report) is set to release fourth-quarter 2022 results on Feb 2, after the closing bell. With the earnings release around the corner, it's worth taking a look at the company’s U.S. sales during the to-be-reported quarter. Also, we will discuss the key projections of the company’s North America market — which accounts for the bulk of automotive sales.
(Also read: Ford Q4 Earnings Coming Up: Credit Unit to Play Spoiler?)
Q3 Highlights of Ford’s North America Market
In the last reported quarter, wholesale unit volumes in the North American segment rose 4% from the year-earlier period to 568,000 units but lagged the consensus metric of 627,000 units. Revenues in the North American segment rose 10% year on year to $26.3 billion in the reported quarter but fell short of the consensus metric of $27.6 billion. Consequently, EBIT totaled $1,309 million, a decrease from $2,423 million in the corresponding quarter of 2021.The figure also missed the consensus mark of $1,955 million.
Things to Note This Time Around
Ford reported fourth-quarter vehicle sales of 483,970 units in the United States, down more than 4% year over year. While SUV sales declined around 11% during the fourth quarter of 2022, sales of trucks inched up 0.6% to 270,064 units. It should be noted that trucks account for the highest sales mix for Ford by the vehicle category and also deliver the biggest profit margin for the auto giant. December marked the best monthly sales of F-series trucks in 2022. Ford sold 75,076 F-Series last month. This augurs well for fourth-quarter revenues from the North America unit. Sales of the maverick truck during the quarter under review jumped to 22,568 units. Ford’s EV sales — comprising Mustang Mach E, E-Transit and F-150 Lightning — rose to 20,339 units in the fourth quarter of 2022. The volumes have not just jumped on a yearly basis, they also increased 11.4% on a sequential basis.
The Zacks Consensus Estimate for wholesale volumes in North America is pegged at 660,000 units, implying an increase from 599,000 units in the year-ago period. Consequently, the consensus mark for revenues from North America is $28.8 million, implying a year-over-year uptick of 11.6%.
While the company is bearing the brunt of commodity cost headwinds stemming from exacerbated supply chain snarls and inflationary pressure, high vehicle prices are offering respite. Ford is passing escalating manufacturing costs to consumers by way of price hikes. During the fourth quarter of 2022, the company raised the price of its popular F-Lightning e-pickup twice citing “ongoing supply chain constraints, rising material costs and other market factors.” In October, it hiked the price of its e-truck by 11%, with the entry-level model starting at $51,974. In December, it again upped its price by $4000 to $55,974.
Ford’s projected wholesale shipments and revenues from the North America segment spark optimism. High vehicle prices are largely offsetting commodity cost inflation, thereby preventing huge margin erosion. The consensus mark for EBIT from the North America segment is pegged at $3,398 million, indicating a jump from $1,822 million.
Ford’s Earnings & Revenue Projections for Q4
The Zacks Consensus Estimate for Ford’s fourth-quarter earnings and automotive revenues is pegged at 59 cents a share and $39.8 billion, respectively.
Investors should note that our proven model does not conclusively predict an earnings beat for Ford this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here. Ford currently has an Earnings ESP of 0.00% and carries a Zacks Rank #5 (Strong Sell).
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks With the Favorable Combination
While an earnings beat looks uncertain for Ford, here are a couple of players from the auto space, which, according to our model, have the right combination of elements to post an earnings beat for the quarter to be reported:
Lear (LEA - Free Report) will release fourth-quarter 2022 results on Feb 2, before the opening bell. The company has an Earnings ESP of +2.71% and a Zacks Rank #3.
The Zacks Consensus Estimate for Lear’s to-be-reported quarter’s earnings and revenues is pegged at $2.53 per share and $5.26 billion, respectively. LEA surpassed earnings estimates in the trailing four quarters, with the average surprise being 18%.
Harley-Davidson (HOG - Free Report) is set to report fourth-quarter 2022 results on Feb 2, before market open. The company has an Earnings ESP of +300.00% and a Zacks Rank #2.
The Zacks Consensus Estimate for Harley-Davidson’s to-be-reported quarter’s earnings and revenues is pegged at 3 cents per share and $880.5 million, respectively. HOG surpassed earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 43.3%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.