A month has gone by since the last earnings report for Ford Motor Company (F). Shares have lost about 2.2% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Ford Motor due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Ford Q2 Earnings Miss Estimates

Ford reported second-quarter 2024 adjusted earnings per share (EPS) of 47 cents, which missed the Zacks Consensus Estimate of 64 cents and declined from 72 cents recorded in the year-ago quarter. The company’s consolidated second-quarter revenues came in at $47.8 billion, up 6.3% year over year.

Segmental Performance

In the second quarter, total wholesale volume in the Ford Blue segment increased 3% year over year to 741,000 units and topped our expectation of 694,000 units. Also, revenues from the segment increased 7% year over year to $26.7 billion and topped our estimate of $24.14 billion on better-than-expected volume. Earnings before interest and taxes came in at $1.71 billion with an EBIT margin of 4.4%. EBIT missed our projection of $2.1 billion.

Total wholesale volume in the Ford Model e segment decreased 23% year over year to 26,000 units but surpassed our expectation of 12,000 units. Revenues from the segment declined 37% year over year to $1.1 billion and topped our estimate of $140.4 million on higher-than-expected volume. Loss before interest and taxes widened to $1.14 billion.

Total wholesale volume in the Ford Pro segment increased 3% year over year to 375,000 but missed our expectation of 408,000 units. Revenues from the segment grew 9% year over year to $17 billion but missed our expectations of $18.17 billion. Earnings before interest and taxes came in at $2.56 billion with an EBIT margin of 15.1%. EBIT exceeded our projection of $2.28 billion.

Overall, F’s total automotive revenues came in at around $44.8 billion, topping our estimate of $42.45 billion on better-than-expected results from Ford Blue and Ford Model e.

Second-quarter revenues from the Ford Credit unit came in at $2,997 million, which increased 18.6% year over year but marginally missed our estimate of $2,999.8 million. Pretax earnings totaled $343 million, which fell from $391 million reported in the year-ago quarter.

Financial Position

Ford reported an adjusted free cash flow of $3.2 billion for the quarter. It had cash and cash equivalents of $19.95 billion as of Jun 30, 2024. Long-term debt, excluding Ford Credit, totaled $18.69 billion at the end of the second quarter of 2024.

F declared its third-quarter 2024 regular dividend of 15 cents per share, payable on Sep 3, 2024, to shareholders of record at the close of business on Aug 7, 2024.

Revised 2024 Guidance

For full-year 2024, Ford’s outlook for adjusted EBIT remained unchanged at $10-$12 billion. However, the company now expects adjusted free cash flow in the range of $7.5-$8.5 billion, up from the previous outlook of $6.5-$7.5 billion. Capital spending is expected in the range of $8-$9 billion.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended upward during the past month.

The consensus estimate has shifted 7.23% due to these changes.

VGM Scores

Currently, Ford Motor has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Ford Motor has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Ford Motor is part of the Zacks Automotive - Domestic industry. Over the past month, General Motors (GM), a stock from the same industry, has gained 5.3%. The company reported its results for the quarter ended June 2024 more than a month ago.

General Motors reported revenues of $47.97 billion in the last reported quarter, representing a year-over-year change of +7.2%. EPS of $3.06 for the same period compares with $1.91 a year ago.

General Motors is expected to post earnings of $2.57 per share for the current quarter, representing a year-over-year change of +12.7%. Over the last 30 days, the Zacks Consensus Estimate has changed +4.4%.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for General Motors. Also, the stock has a VGM Score of A.

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