Perspective Automakers Stocks: Ford
Ford shares are trading 75% off their peak prices. The company is suffering from a lack of auto parts. Nevertheless, the company is presenting better-than-expected revenues for the fourth consecutive quarter. The company has reported $41.8 billion in revenues vs the expected $40.73. Earnings per share at $0.51 missed expectations by $0.11. Ford’s CEO, Jim Farley, said the company missed about $2 billion in profits amid higher input costs, disrupted supply chains and a stronger Dollar. However, the management is planning to improve these results soon.
This sounds positive as management can see where it has missed profits and are likely to make necessarily corrections. They should target higher operational costs that have wiped out 60% of the missed profits as suppliers have failed to deliver auto parts according to the plan amid global deficit. Ford is planning to enhance the design of electric vehicles to use a wider range of microchips for car manufacturing.
The company has strong financial as it accumulated about $32 billion in cash and its equivalents that enabled the payment of quarter dividend of $0.15 per share and additional payments of $0.65 per share. The company has promised to pay 40% to 50% of net cash flow to its shareholders in the future.
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