Ford (F) Gears up to Report Q2 Earnings: Here's What to Expect
Ford Motor Compay F is slated to release second-quarter 2023 results on Jul 27, after the closing bell. The Zacks Consensus Estimate for the quarter’s earnings is pegged at 48 cents a share. The bottom-line projection implies a year-over-year decline of 29.41%. The Zacks Consensus Estimate for Ford’s second-quarter earnings per share has moved north by 2 cents in the past 30 days.
The U.S. auto biggie beat earnings estimates in the last reported quarter. Over the trailing four quarters, Ford surpassed earnings estimates twice and missed on the other two occasions, the average surprise being 24.35%. This is depicted in the graph below:
Ford Motor Company Price and EPS Surprise
Ford Motor Company price-eps-surprise | Ford Motor Company Quote
Q1 Highlights
Ford’s first-quarter adjusted earnings came in at 63 cents per share, beating the Zacks Consensus Estimate of 40 cents. The bottom line rose 65.8% from the year-ago quarter’s earnings of 38 cents. The company’s consolidated first-quarter revenues came in at $41,474 million, up 20.3% year over year.
Ford reported an adjusted free cash flow of $693 million during the quarter. It had cash and cash equivalents of $22,144 million as of Mar 31, 2023 compared with $25,134 million on Dec 31, 2022. The automotive long-term debt increased to $19.1 billion from $19.2 billion as of 2022-end.
Things to Note Ahead of Q2 Release
The U.S. legacy automaker has started reporting its automotive results under three business segments — Ford Model e, Ford Blue and Ford Pro. While Ford Blue focuses on the firm’s legacy gas-powered business, Ford Model e focuses on EVs, advanced technologies and several related aspects to support electrification plans and Ford Pro deals with commercial vehicles and services.
Ford’s second-quarter revenues are likely to have been aided by a projected increase in Ford Blue wholesale units. For the quarter under review, our estimate for Ford Blue wholesale shipments is pegged at 720,000 units, indicating an increase from 670,000 units in the year-ago period. Our forecast for second-quarter Ford Blue sales is $24,061 million, implying an uptick from $23,834 million recorded in the corresponding quarter of 2022.
Ford recorded sales growth of 11.2% in the United States during the second quarter of 2023. Ford’s F-Series became America’s top-selling truck with a 34% rise in sales in the quarter under review. Ford truck sales gained momentum in the second quarter due to strong performance of new Super Duty and improved inventory flow.
For the second quarter, we expect adjusted EBIT for Ford Pro to be around $1,480 million, up from $879 million recorded in the corresponding quarter of 2022. Profit from the Ford Pro segment is likely to have boosted the second quarter results.
Earnings Whispers
Our proven model predicts an earnings beat for Ford for the to-be-reported quarter, as it has the right combination of the two key ingredients. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is the case here.
Earnings ESP: Ford has an Earnings ESP of +3.73%. This is because the Most Accurate Estimate is pegged 2 cents higher than the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: F currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Stocks With the Favorable Combination
Here are a few other players from the auto space that, according to our model, also have the right combination of elements to post an earnings beat this time around.
Oshkosh Corporation OSK will release second-quarter 2023 results on Jul 27. The company has an Earnings ESP of +21.36% and a Zacks Rank #2.
The Zacks Consensus Estimate for Oshkosh’s to-be-reported quarter’s earnings and revenues is pegged at $1.62 per share and $2.24 billion, respectively. OSK surpassed earnings estimates once in the trailing four quarters and missed three times, the average negative surprise being 4.37%.
Lear Corporation LEA will release second-quarter 2023 results on Aug 1. The company has an Earnings ESP of +3.16% and a Zacks Rank #2.
The Zacks Consensus Estimate for Lear’s to-be-reported quarter’s earnings and revenues is pegged at $3.05 per share and $5.72 billion, respectively. LEA surpassed earnings estimates in all the trailing four quarters, the average surprise being 15.53%.
Magna International MGA will release second-quarter 2023 results on Aug 4. The company has an Earnings ESP of +1.53% and a Zacks Rank #3.
The Zacks Consensus Estimate for Magna’s to-be-reported quarter’s earnings and revenues is pegged at $1.25 per share and $10.17 billion, respectively. MGA surpassed earnings estimates in one of the trailing four quarters and missed thrice, the average negative surprise being 6.46%.
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