Ford slashes its guidance
Shares of Ford Motor are down 1.5% at $11.59 Thursday morning, after the company slashed its earnings guidance for the first quarter.
The automaker expects adjusted first-quarter earnings of $0.30 to $0.35 per share, well below the $0.47 that is expected by the Bloomberg consensus. Ford cited "higher costs (including commodities, warranty, and investments in emerging opportunities); lower volume (primarily fleet); and unfavorable exchange" as reasons for the revision.
Ford's revised first quarter outlook comes following a Morgan Stanley note that was released on March 20 where the firm reiterated its underweight rating and $11 target for the stock.
"We believe a decline in used car values may occur a bit later than consensus, but could also prove to be far more severe," the team led by equity analyst Adam Jonas wrote. "We see Ford as particularly vulnerable given the size of its Finco program relative to other OEMs."
On Wednesday, Fitch released a report that showed subprime auto loan delinquency rates are moving higher.
Shares of Ford are down 3% so far in 2017.
(Markets Insider)
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