Why Ford Stock Surged Over 7% after Its Q1 Earnings



Ford’s Q1 2019 earnings

US legacy automaker Ford Motor Company (F) announced its first-quarter results on April 25, 2019, after markets closed. In the first quarter this year, Ford’s adjusted EPS stood at $0.44, about 2.3% higher than the company’s adjusted earnings of $0.43 per share in the first quarter of 2018. Its adjusted EPS were also 65.7% better than Wall Street analysts’ consensus estimate of $0.27, according to Thomson Reuters data. Before we look at key highlights of Ford’s first-quarter event, let’s find out how investors reacted to its quarterly results.

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Ford stock surged over 7%

Before its first-quarter earnings announcement, Ford stock witnessed negative movement on Thursday and settled with a 1.8% drop to $9.40. However, soon after the company released its fourth-quarter results after the closing bell, its stock recovered sharply in the after-hours trading session with a 7.1% rise to $10.07.

During the third-quarter earnings event, Ford’s management maintained its 2019 guidance, which it gave in January. In 2019, the company expects an improvement in its revenue growth rate and adjusted EBIT margin as compared to 2018, but didn’t give any specific 2019 guidance figures.

Despite a YoY decline in the first-quarter revenue, Ford’s improved profit margins due to stronger truck and utility vehicle demand and far better-than-expected adjusted EPS were the primary reasons why its stock surged by over 7% in the after-hours trading on Thursday.

Ford stock has outperformed the broader market in 2019 so far. As of April 25, Ford was trading with 22.9% YTD gains as compared to the S&P 500 benchmark’s 16.7% rise.


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