Ford Q4 Earnings Highlights: Revenue Beat, EPS Beat, Supplemental Dividend, EV Update And More

7 months ago

Automotive giant Ford Motor Company (NYSE:F) reported fourth-quarter financial results after the market close Tuesday.

Ford reported fourth-quarter revenue of $46 billion, which was up 4% year-over-year. The revenue total beat a Street consensus estimate of $39.53 billion, according to Benzinga Pro data.

The company reported earnings per share of 29 cents, which beat a Street consensus estimate of 13 cents per share.

Transcript

00:00 Ford, of course, one of our biggest companies here in Detroit. Let's go to the numbers real

00:06 quick. Strong quarter, and you've got some news on the dividend as well, driving the stock higher.

00:11 So EPS came in at 29 cents, crushed the 13 cent estimate. Sales numbers came in at, let's see,

00:20 46 billion versus 39 billion estimate. So both double beat strong quarter. And the company also

00:29 talked about reining back some of its EV investments, saying it's going to be able to

00:34 increase capital efficiency. Again, declared a 15 cent regular dividend, 18 cent supplemental

00:40 dividend. Investors love this. The stock is trading up more than 5% pre-market after closing

00:46 up more than 4% yesterday. Yeah, impressive moves here. I've had this story wrong. I keep thinking,

00:52 you know, 2024 and maybe it's coming, but I keep thinking people aren't going to have the money

00:57 to buy cars, but they're finding the money. And it's enough where we've got to just analyze and

01:02 say, look, we've expected people to curtail their spending to a certain extent that has not happened.

01:09 That has not happened in the economy. It hasn't happened in anything. So if you're sitting here

01:12 waiting for the great recession, it has not occurred and it does look like they have navigated

01:17 a soft landing. It could still, maybe the effects are still delayed, maybe the higher rates for

01:20 long. But now we're talking about lowering rates. So if you're sitting here saying, I'm short stocks,

01:24 eventually we're going down. I think that ship has sailed. I mean, obviously we've run a long

01:30 ways and there's pockets of irrational exuberance maybe, but for the most part here, stocks aren't

01:36 really crazy valued. I know there's these comparisons that were in 1999 and this is

01:40 the big tech bubble. We've done those comparisons, you know, looking at different PEs of stocks.

01:44 The market is not crazy expensive here. It's expensive, but Microsoft isn't trading 90 times

01:49 earnings. That's where it was during the tech bubble. It's trading 34 times earnings. It sounds

01:54 expensive when it was trading at 24 times earnings a year ago, but it's not like it was back in the

02:02 tech bubble. So we're not at that. There's catalysts and then there's sneaky catalysts.

02:06 Sure. And you know what the sneaky catalyst for Ford's been?

02:09 What? The Lions.

02:12 Oh, there you go. I've been thinking about that. During the whole season,

02:18 people, the Lions, the Fords own the Lions, a little bit of a sneaky catalyst there.

02:24 Do you go out and buy the stock based on how a football team is doing? No, but if they were

02:29 in the Super Bowl, it would probably be 13 bid. But mentioning $13 here, man, it's got to be a

02:36 boatload of size at 13. They got to fulfill the book. We closed yesterday at 1210. There's probably

02:43 a boatload of size there at $13 where they opened the stock. Pre-market high comes in at 1290.

02:51 But just only the word of caution here, and I wish I would have stated it yesterday. You know

02:58 the way that Palantir was trading up and yeah, there was a big number there. Just the mentality

03:04 of the market lately. I'm like, I'm not standing. Why stand in front of this one? So if you take

03:12 out the sellers at 1290, 13 bucks, you get a $13 bid, but this is Ford. This is a lot of stock. So

03:20 we'll see how it reacts off the open. You got a long ways to go to get to the top of yesterday's

03:26 range at 1210, but keep an eye at 13 bucks here. That's a big level for Ford. And GM has kind of

03:34 been leading the way on this one. GM's had a nice order. Toyota, all the automotive companies,

03:40 Toyota reported yesterday. We didn't get to that. Had a huge pop. I mean, all the automotive

03:45 companies have really been proving it that we're still, and the valuations are so low on these

03:51 things that if they can continue to make money even where they're at, these things are just

03:54 dirt cheap. I keep thinking the E's going to start to come down and then they're not going

03:58 to look as cheap, but that has not happened. We have not seen people, people spend. People are

04:04 spending money and people are finding ways to buy cars and maybe they're finding the financing a lot

04:07 cheaper. I look at financing on cars and it looks like seven and a half, 8%. But again, maybe there's

04:14 finding ways. People are saying there's 5% financing. Maybe incentives are out there to try

04:19 to bring those numbers down. They're finding ways to sell cars. Well, I mean, how do you guys trade

04:24 these car stocks? Because these aren't ones for me that I want to hold in my long-term portfolio

04:29 just because the growth story isn't there for me. I mean, how many cars can you sell, right? If

04:35 a Toyota stock is down and I think it's at a good value, I could put it in my long-term portfolio

04:39 and try to make 20% over it. But it's not a stock that I think is going to 10X over time.

04:45 So maybe just trading it on like swing trade when they get too beat up, buy them when they

04:50 start ripping, sell them. I mean, do you guys trade these? Yeah, I trade them against each

04:54 other. I trade Ford with GM and Toyota and you look at the trends. It's predictable that when GM

05:00 beat it pretty handily, that Ford's probably going to beat it pretty handily. And I mean,

05:05 if you're long going to that report, if you have the guts to do it, you're making some money. It's

05:09 probably predictable that Toyota was going to do pretty good and Toyota did the same thing.

05:12 So just getting that lead from other stocks like other companies here helps you to trade these and

05:19 day trade these. Are they long-term investments? I mean, Ford and GM have been very poor long-term

05:24 investments. So not dissing the whole auto sector here, but we've had bankruptcy with GM, a reorg.

05:33 Ford did not. Ford got all the way down, remember, to a buck. They never really diluted themselves or

05:39 anything. They were the one that kind of made it through it. And obviously it's come a long

05:44 ways back from there. But I mean, go back to the long, long-term here, Joel. I mean,

05:48 what is the all-time high in Ford? It's kind of like, feels like the banks to a certain extent,

05:53 although $40 in 1999. $40 in what year? Yeah, 1999. But they did spend some stuff off.

06:01 What? They had a credit facility that they spun off. So you probably, I can't think of it, AFS,

06:11 Jay Rice, someone help me out with the chat here. But I want to make one comment here on the

06:16 earnings. Well, first of all, being a contrarian, remember when these stocks were hated during the

06:21 strikes? Like, "Oh my gosh, we got to get out of this." People thought they were going out of

06:26 business as if there had never been strikes before against the auto companies. What makes me cautious

06:31 here a little bit is I know the wages have gone up for the employees and the expenses, but has it

06:38 filtered its way all the way through the balance sheet? So when is that going to hit? Is that going

06:45 to be next quarter? I'm not an accountant. I don't know, but there are higher, they are paying higher

06:51 wages, whether you're looking at Q4, right? That was the end of last year. We'll see what Q1.

06:58 But technically, let's just keep an eye. It seems well bid up here, trading a lot of volume,

07:04 big day for Ford, up 5.63%. To answer Aaron's question, though, I was just trying to do the

07:10 long-term and you can say it spun something off. But there's no doubt that GM and Ford have been

07:15 very poor long-term investments. And I mean, results speak for themselves here. So I'm with

07:22 you, Aaron. I don't think these are the companies that are going to drive, pun kind of intended,

07:27 drive the next bull market here. That's good.

07:30 That's why when I made NASA the acronym, there was no car company in there. I was going after the AI

07:37 story, the weight loss story. What's the story is going to drive? It's cars, hybrids, that's going

07:43 to drive the next. I thought EV, but EV seems to be just on the back burner. All they're talking

07:48 about now is hybrid, Joel. They're not talking about EVs anymore. Toyota's talking hybrids.

07:52 And hybrid technology has been out there for a long time. I had 2008 Mariner that was hybrid.

07:57 So I mean, you're talking 15 years, but that's where they're leaning back to is the hybrid

08:02 as opposed to going full EV. So that's why the lithium stocks have really been just a disaster.

Ford Q4 Earnings Highlights: Revenue Beat, EPS Beat, Supplemental Dividend, EV Update And More

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