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Ford Motor Third Quarter Earnings Preview

October 25, 2012 | Filed Under »
Tickers in this Article » F
Ford Motor (NYSE:F) will release its third quarter results on Tuesday, October 30, 2012. Analysts are expecting earnings per share of 30 cents after the company booked a profit of only 46 cents a share a year earlier.



Earnings play an important role in measuring the appropriate valuation for a stock. Investors should be cautious if the company's stock price is high but it consistently has low earnings. SEE: Surprising Earnings Results

What to Expect: Ford is expected to report earnings of 30 cents per share, down 34.8% from a year ago, when the company reported earnings of 46 cents per share.

In the last 30 days, the consensus estimate has jumped from 29 cents, but it is short of the estimate of 32 cents from three months ago. For the fiscal year, analysts are projecting earnings of $1.27 per share.

Ford is expected to report revenue of $31.08 billion for the quarter, down by 6% from last year's figure of $33.05 billion. For the fiscal year, expected revenue is $126.19 billion.



Company Performance: Revenue has risen by an average 2.2% in the last four quarters. The most significant increase took place in the third quarter of the last fiscal year, when it rose 10.6% from the year-earlier quarter.

The P/E ratio for F is 2.3, below the industry average of 7.29. A low P/E might arise due to substantial inherent risk of the firm and its operations, poor return on equity, or improper valuation of the market. A simple P/E ratio can reveal the stock's real market value and show how the valuation compares to its industry group or a benchmark like the S&P 500 Index. High P/E stocks could be "growth" stocks, while low PE stocks may be "value" stocks. SEE: How To Use The P/E Ratio And PEG To Tell The Future Of A Stock



The stock price has increased from $9 on July 27, 2012 to $10.17 over the past quarter. Ford's best recent streak was when its price gained $1.27 per share between August 29, 2012 and September 19, 2012.





The Competition: Ford is an automaker that sells its cars and trucks throughout the world. The majority of analysts (11 of 16) rate Ford a buy. Opinion about the stock has worsened recently, as buy ratings have dropped slightly over the last three months.

The company's closest competitor in the auto and truck manufacturers industry is Toyota (TM). Analysts are more optimistic about Ford than about Toyota. Only one out of two analysts rate the latter a buy.



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