Why These 3 Analysts Are Unimpressed With Ford's Q2 Beat

Why These 3 Analysts Are Unimpressed With Ford's Q2 Beat

Ford Motor Company F crushed Wall Street expectations, with quarterly revenue at $40.2 billion, up 50% year-over-year, and adjusted earnings 68 cents per share, versus a consensus of 45 cents per share.

RBC Capital Markets On Ford Motor Company

Analyst Joseph Spak maintained a Sector Perform rating while reducing the price target from $16 to $15.

Although Ford’s results were good, they cannot be extrapolated, Spak said in a note. He explained that profits were unduly impacted by the inclusion of 618,000 vehicles that were not completed in the first quarter and North American margins included one-time benefits.

Despite the beat and raise, Ford reiterated its full-year guidance, which has implications for its performance in the back half of the year, the analyst stated. Although the dividend hike was welcomed, “we’d rather see Ford hold on to cash for the coming transition,” he added.

Check out other analyst stock ratings.

Morgan Stanley On Ford Motor Company

Analyst Adam Jonas reiterated an Equal-Weight rating and price target of $13.

Ford’s results were “driven by strong price/mix,” Jonas said in a note. Demand is likely to continue exceeding supply this year, the analyst stated. “Continued supply recovery and consumer pressure create highly uncertain outcomes for FY23 keeping the stock stuck in a range,” he added.

Wells Fargo On Ford Motor Company

Analyst Colin Langan reiterated an Underweight rating while establishing a price target of $10.

“Despite the large beat, Ford maintained FY guidance,” Langan said in a note.

“Volume offsets in 2H include FMCC profits (~$700M), inflationary costs (~$1B), and FX & investments costs,” the analyst wrote. “We think losses associated with the Ford Lightning EV ramp in 2H likely contribute to the weakness,” he added.

F Price Action: Shares of Ford Motor Company had risen by 6.07% to $13.97 at the time of publication Thursday.

Photo: D K Grove via Shutterstock

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