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Ford's Stock Races Higher After Q3 Beat, Growth In China And Ford Credit

Chris Katje
·2 min read

Revenue and earnings per share from one of Detroit's "Big Three" came in above consensus for the third quarter after the automobile company reported earnings after market close Wednesday. 

What Happened: Ford Motor Company (NYSE: F) reported third-quarter revenue of $37.5 billion, beating estimates of $32.9 billion. Earnings per share were 65 cents, almost double the 34 cents reported in the prior year's third quarter.

Adjusted EBTIDA margin was 9.7%, which was nearly five points above last year’s 4.8% and came in above Ford’s long-term target of 8%.

The company reported a market share of 6% in North America, which was the same as last year. Market share rose in Europe and China, while falling in South America.

Ford Credit had its strongest quarter in 15 years.

Related Link: Ford Vs. General Electric: The Blue Chip Race Back To

View more earnings on F

Why It’s Important: New CEO Jim Farley took over on Oct. 1 and immediately put a plan in place to get rid of unprofitable vehicles. He wants Ford to focus on electric vehicles and its existing strong brands.

“We know that there’s huge value to be unlocked as we turn around our automotive operations. There will be additional opportunity when we start growing again, which we will do with products and services customers can’t resist,” Farley said in a press release.

The company highlighted its upcoming fourth quarter, which includes three new “game changing vehicle launches.” A new Ford F-150 truck, an all-electric Mustang Mach E and the Bronco Sport are expected in the fourth quarter.

In China, Ford delivered 22% more vehicles compared to last year’s third quarter. The company’s market share in China increased 0.1% to 2.4%, marking the third straight quarter of year-over-year market share gains in the country.

Ford expects full-year adjusted EBIT to be between a $500 million loss and breakeven.

The company ended the quarter with $30 billion in cash and $45 billion in liquidity after repaying a $15 billion credit it drew in the first quarter.

F Price Action: Shares of Ford are up 6% in after-hours trading to $8.18.

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