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Ford: Vanguard, BlackRock, and State Street Raise Holdings

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The Vanguard Group, BlackRock Institutional Trust Company, and State Street Global Advisors raised their holdings in Ford (F) stock in the second quarter. Notably, seven of the top ten holders in the stock have increased their stakes. Usually, rising institutional holding implies a favorable opinion on a stock.

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Institutional holdings in Ford

Vanguard has the highest institutional holdings in Ford. According to Reuters, Vanguard bought 3.95 million shares in the second quarter. Vanguard’s holdings stood at 7.6% at the end of the second quarter. Also, Reuters data showed that BlackRock Institutional Trust raised its holdings in Ford stock by over one million shares. State Street bought 2.35 million shares in the second quarter. State Street’s holdings stood at 4.5% at the end of the second quarter.

Geode Capital Management and Dimensional Fund Advisers bought 2.27 million and 1.22 million Ford shares. Greenhaven Associates and Northern Trust Investment purchased a relatively low quantity of the shares.

However, Franklin Advisers sold a massive chunk of Ford stock. According to Reuters, Franklin sold a whopping 17.99 million shares of the stock in the second quarter. Franklin Advisers’ holdings fell to 1.53%. Pzena Investment Management also sold 5.96 million Ford shares.

Ford’s stock performance

Auto stocks have fallen in August amid the US-China trade tension and fears of a recession.

Ford stock fell 6.0%. The company’s second-quarter earnings fell short of analysts’ estimate by about 9%. General Motors (GM), Fiat Chrysler Automobiles (FCAU), and Tesla (TSLA) have fallen about 8.4%, 6.3%, and 6.5%. General Motors’ (GM) earnings fell but beat analysts ‘forecast. Fiat missed its earnings estimate, while Tesla’s earnings fell short of the forecast. Ferrari (RACE) has fallen 3.8%. However, the company posted a strong set of numbers in the second quarter.

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Earnings outlook

The company expects its EPS to be between $1.20 and $1.35 in 2019—compared to $1.30 in 2018. Analysts expect Ford’s EPS to fall about 1% to $1.29 in 2019. However, they expect Ford’s earnings to rise by about 8% to $1.40 per share in 2020.

Eight of 19 the analysts have a favorable opinion on Ford stock. Analysts are divided on the stock due to its dull current performance and strong outlook. The company expects its four focus areas to bolster its future growth trajectory. The holdings could change in the third quarter based on the change in the company’s outlook after its earnings.

Second-quarter earnings call

In the second-quarter earnings conference call, Ford’s CFO, Timothy Stone, said, “First, both 2019 and 2020 are robust launch years for us, as we bolster our winning portfolio for customers, reallocate capital to higher-return growth opportunities and execute changeovers of our most profitable and highest-volume vehicles. Second, our global redesign and fitness initiatives are progressing well, improving the trajectory of future growth, cash flow, profitability and returns on capital.”

He also said, “Third, Ford Credit continues to deliver excellent results. And fourth, relative to Auto, we continue to expect strong execution this year, especially in North America, Europe, and China.”

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