Ford Motor (F) stock has been underperforming the broader market and its peers (XLY) for the past three fiscal quarters. In 1Q17, Ford stock fell 4.0%. During the same period, the stocks of General Motors (GM), Fiat Chrysler Automobiles (FCAU), and Tesla (TSLA) rose 1.5%, 19.8%, and 30.2%, respectively.
Last week (ended April 7), Ford stock fell 3.5%, and the company reported a 7.2% YoY (year-over-year) decline in its March US sales. Ford’s 1Q17 US sales were 4.4% lower on YoY basis.
We should note that Ford’s lower SUV (sport-utility vehicle) sales in 1Q17 could hurt its profit margins for the quarter. No major improvement in Ford’s 1Q17 margin is expected, as heavyweight vehicles, including utility vehicles, yield higher margins for automakers. Investors’ low expectations from Ford’s upcoming results could thus continue to hurt its stock in the near term.
We should also note that in 4Q16, Ford’s deteriorating profitability and stagnation in its home market sales were key concerns. During its 4Q16 earnings call, Ford’s management didn’t seem too confident in the company’s 2017 outlook as it warned investors of potential risks.
As of April 7, Ford stock was trading at $11.23. This weakening underlying momentum suggests that the stock price could fall further and test a support near its 52-week low of $11.07 this week. An immediate horizontal resistance lies near $11.40.
Continue to the next part for a look at Fiat Chrysler’s recent updates and key technical levels.