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Wall Street Expects Ford’s Earnings Trend to Improve in Q2 2019

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Apr. 26 2019, Published 8:08 a.m. ET

Ford’s earnings trend

The trend in Ford’s (F) earnings turned positive in the first quarter as it reported positive YoY growth in its earnings for the quarter after posting a YoY decline for the previous three quarters. In the last four quarters, the company has managed to beat Wall Street analysts’ earnings estimates twice. Let’s find out whether or not analysts expect the positive trend in Ford’s earnings to continue in the coming quarters.

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Wall Street expects a positive trend

According to the data compiled by Thomson Reuters as of April 25, Wall Street analysts expect Ford to report adjusted EPS of $0.28, which reflects 5.3% YoY positive growth in the company’s earnings. Analysts estimate the growth rate in Ford’s earnings to improve further in the third quarter to 14.1% YoY.

These estimates suggest that Ford could report $35.9 billion and $34.5 billion in revenue in the second and third quarters of 2019, respectively, which would be nearly flat on a year-over-year basis.

It’s important to note that in the last couple of quarters, Ford has tried to reduce its small passenger car sales to stay focused on pickup trucks and utility vehicles. This strategy should result in a higher contribution of pickup trucks and utility vehicles in Ford’s total vehicle sales and improve profitability as profit margins from trucks and utility vehicles tend to be higher as compared to small passenger cars.

Also, Ford’s upcoming new vehicle launches, especially in the pickup truck and SUV segment, could attract more customers and keep investor optimism alive.

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