Ford (F) earnings Q3 2021

DETROIT – Ford engine Wall Street earnings expectations nearly doubled and third-quarter revenue forecast slightly exceeded, prompting the automaker to raise its annual forecast for the second time this year.

Here’s how Ford fared against Wall Street expectations, based on average analyst estimates compiled by Refinitv.

  • Adjusted EPS: 51 cents per share adj. vs. 27 cents per share expected
  • Automobile sales: Expected to be $ 33.21 billion versus $ 32.54 billion

Ford stock rose more than 8% during after-hours trading. The stock closed Wednesday down 2.7% to $ 15.51 per share.

Ford also said on Wednesday that it would be Reintroduction of the regular dividend from the fourth quarter, more than a year and a half later Suspension of payments in the early days of the corona pandemic.

New instructions

The automaker’s new adjusted earnings forecast for the full year is between $ 10.5 billion and $ 11.5 billion, down from $ 9 billion to $ 10 billion. Ford stuck to its adjusted free cash flow expectations of between $ 4 billion and $ 5 billion.

Baked into the new forecast are fourth-quarter expectations that include an increase in wholesale shipments from the third quarter onwards combined with a continued healthy mix of vehicles sold and net prices. These gains are expected to contrast with sequentially lower results from its financial sector, Ford said.

“The results really show the underlying strength of our business,” said John Lawler, CFO of Ford, on a phone call on Wednesday.

The company raised its guidance for the year, even though Lawler had previously said the second half of the year would be weaker than the first six months. He cited $ 3-4 billion in beneficial higher sales volumes, but said raw material costs, lower Ford Credit revenues, and other factors such as $ 500 million higher warranty costs detracted from year-end results.

‘There is more to come’

Ford cited strong demand for newer products such as the Bronco SUV and Mustang Mach-E, which the company said could reach 200,000 units sold per year worldwide.

“I believe we have the right plan to drive growth and unlock unprecedented value,” Ford CEO Jim Farley told investors on Wednesday during a call. “You are already seeing a positive change in the slope of our earnings and cash flow. There is more to come.”

On an unadjusted basis, Ford’s net income was $ 1.8 billion, up from $ 2.4 billion last year when dealerships and plants largely reopened after closing in the second quarter due to the coronavirus pandemic. The automaker reported adjusted earnings before taxes of $ 3 billion for the third quarter, up from $ 3.6 billion a year earlier.

Automobile sales were down 5% for the quarter, compared to $ 34.7 billion in the third quarter of 2020.

2022

Ford declined to provide a financial outlook for 2022, but Lawler said the company expects the chip shortage to persist through 2022 and possibly, to a far lesser extent, through 2023. He said Ford anticipates an increase in 2022 of wholesale vehicle volume by 10% compared to this year as the semiconductor shortage continues to affect business.

Lawler also said the automaker expects raw material costs to rise $ 3 billion to $ 3.5 billion in 2021 and could rise another $ 1.5 billion in 2022.

Ford received some bullish calls from Wall Street analysts for profit, including an appreciation from Credit Suisse to excel by neutral.

Ford’s greatest American rival, General Motors, announced Wednesday morning third-quarter earnings that exceeded Wall Street estimates. Despite the blows, GM’s stock declined more than 5% during intraday trading on the back of the automaker Lowering the free cash flow guidance for the year and fail to meet some investor expectations for the rest of the year.

Separately, Farley said on Wednesday Ford would postpone an over-the-air rollout of its BlueCruise hands-free freeway driving from this year to the first quarter of next year. The technology is seen as a new recurring revenue opportunity and is expected to catch up with other systems from competitors such as GM and Tesla.