Ford (NYSE:F) has temporarily had some of its shine tarnished, but that shouldn't stop the company from rebounding strongly, although the brand has had some pressure from earnings disappointment, lack of clear communication, and the announcement more of their vehicles are being recalled.
That's probably good for the stock so it can take a breather, and also a good time for investors to load up on some more shares of the company.
After several straight quarters of good earnings surprises, Ford dropped the ball with its fourth-quarter earnings results. Its operating profit of $1.3 billion, not including charges, was $322 million down from last year's quarter. Including a $960 million charge for debt conversion, Ford earned net income of $190 million, or 5 cents a share, against $886 million, or 25 cents a share, in the same quarter last year. Revenue for the quarter increased by $1.6 billion to $32.5 billion, when not including Volvo.
The greatest shock was its earnings though, as they came in at 30 cents a share, far below market estimates of 48 cents a share.
A weak performance in Europe was the main weight on the company, along with the financial services unit of the company.
The good news is Ford still enjoyed its highest profits in 11 years.
Ford showed during the worst of the recession that they could navigate through it without getting a handout from the taxpayers. That has counted more toward the positive view many have on the brand than anything, and also its popular truck segment.
They reduced their debt by over 40 percent, and has an overall popular line of vehicles to offer.
CEO Alan Mulally said the company has now went from a time of fixing the patient to one that is in health and ready to grow.
A leaner and meaner Ford, with a solid line of vehicles to offer the public should continue to be the story, even as the company spends more capital on growth.
Ford closed Thursday at $15.76, gaining $0.36, or 2.34 percent.
Friday, February 4, 2011
Time to Grab More of Ford (NYSE:F)?
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3 comments:
Has now went?
F is still the most expensive OEM.
The truck line which has nice margins is still considered the best safe choice. With the new and more attractive Focus coming out which is already a proven performer in other parts of the world and solid engine technology improvements like the V6, Ford seems strong. I've never owned one but the value perception since 2008 has be that of steady quality. The recall effect from the other day barely dipped the numbers more that an hour. Seems like a strong company to me. I just wish they would drop the "Taurus" title and call that model something else.
Drive some of their latest models (Focus, Milan) and judge for yourself. A nice blend of Euro handling with Jap fit and finish. I bought some F at $10 and I'm holding it long-term.
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