The Ford earnings report released Tuesday shows its best quarterly performance in six years at $ 2.1 billion and Ford stock is blowing up. The Ford Motor Co., the only Detroit automaker not bailed out of bankruptcy with low interest loans from the Federal government last year, has earned a profit for four consecutive quarters while its domestic rivals flounder. By slashing costs and increasing sales, Ford stock price and Ford earnings report numbers have shifted from negative to positive a year ahead of schedule, even as the market for new cars has yet to recuperate.
Stock price for Ford soars
For stock hit $ 14.57 Monday making it a five year high. Ford earnings report showed profit equaling 50 cents a share when Wall Street only expected 32 cents a share. Ford stock traded at $ 1.91 a share just one year ago and the earnings report showed it had lost $ 1.4 billion, which is 60 cents a share. Introducing new products, closing plants and eliminating tens of thousands of jobs is working like Ford boss Alan R. Mulally said it would when he took over four years ago. For executives said that in the urgent future, they plan to continue to sell cars for positive money flow while they were presenting the earnings report.
Ford earnings report fuels production
Ford said it prepared to build 625,000 cars in the United States and Canada within the second quarter, which is 9 percent more than the first quarter and 39 percent a lot more than exact same period a year ago. Later this year, smaller and more fuel efficient cars should be introduced with the aim to capture a bigger piece of the growing market. Ford fans should probably be getting auto loans here in the near future for new versions of the Fiesta and Focus, plus a retooled Edge crossover and a more fuel efficient Explorer SUV.
Ford Stock and an analysis
An analysis of Ford stock will show a rise in price of a lot more than 40 percent so far in 2010. Ford's market share within the US rose to 16.6 percent in the first quarter, which is up 2.7 percent from the first quarter 2009. In February, it outsold General Motors for the first time in 50 years. Adding to the cost cutting and increased focus on quality, Ford’s gamble to forgo the government bailout seems to have paid off in spades as the images, and sales, of GM and Chrysler have suffered. Toyota’s recall of at least nine million automobiles and the resulting publicity nightmare of the past six months probably didn't hurt Ford stock either.
Ford Stock and the outlook
The outlook of Ford stock hints the stock price might not sustain its current rally. The New York Times reports that Ford’s chief financial officer Lewis W.K. Booth said the company does not necessarily expect each of the next 3 quarters to be as strong as the first, particularly if an improving economy leads to higher interest rates later in the year. Tuesday, after the earnings report was released, stock started falling as if on cue. At noon Eastern time, Ford stock was already down about 6.5 percent at $ 13.50 per share. Since January 2005, Monday's closing price on stock was the highest. An issue with Ford stock outlook might be debt survival. The business nevertheless has much more debt $ 34.3 billion, than cash, $ 25.3 billion.
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