uploads///ford _

Ford’s Q3 Results: Why Its Stock Rose 7.6% in After-Hours Trading


Jul. 16 2019, Updated 4:13 p.m. ET

Ford’s Q3 2018 earnings

Ford (F), the second-largest US automaker, announced its third-quarter results on October 24 after the market closed. In the third quarter, Ford’s adjusted EPS fell ~33.0% YoY (year-over-year) to $0.29. Its third-quarter earnings per share were slightly better than Wall Street analysts’ consensus estimate of $0.28, as compiled by Reuters.

Article continues below advertisement

Profitability disappointed

In the third quarter, Ford’s (F) global revenues rose 3.0% YoY to $37.6 billion. This total revenue figure included the company’s Automotive segment’s third-quarter revenues of $34.7 billion, which also rose 3.3% YoY.

Ford increased its third-quarter automotive revenues despite a 10.0% YoY decline in its global wholesale figures. This factor may have boosted investors’ optimism.

In contrast, Ford’s Automotive segment’s EBIT fell 26.3% YoY to $1.4 billion in the third quarter. This drop also affected the company’s third-quarter EBIT margin of 4.0%, which was much lower than its EBIT margin of 5.6% in the third quarter of 2017.

The company reported automotive EBIT losses from its South America, Europe, and Asia-Pacific segments. However, its EBIT profitability from its Middle East & Africa and North America segments remained strong.

No change in guidance

During its second-quarter earnings event, Ford (F) revised its 2018 earnings guidance downward. The company maintain its EPS guidance and expects its 2018 adjusted EPS to be $1.30–$1.50, lower than its original guidance of $1.45–$1.70.

On October 24, Ford stock closed at $8.18 with a 4.7% drop from its previous session’s closing price. Among the other auto stocks (XLY), General Motors (GM), Fiat Chrysler (FCAU), and Tesla (TSLA) settled with losses of 4.9%, 8.1%, and 1.9%, respectively, in Wednesday’s session.

At 4:40 PM EDT, Ford stock rose 7.6% in aftermarket trading at $8.80. Despite Ford’s ongoing struggle in markets like China and Europe, its third-quarter earnings beat, higher revenues, and strong profitability in North America could be key factors in its sharp recovery in aftermarket trading.

Tesla stock also rose in today’s aftermarket session.


More From Market Realist

    • CONNECT with Market Realist
    • Link to Facebook
    • Link to Twitter
    • Link to Instagram
    • Link to Email Subscribe
    Market Realist Logo
    Do Not Sell My Personal Information

    © Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.