7:33 am Cars, Construction Equipment, Trucks
As a company that has manufacture automobiles since the early 1900s, Ford Motor (NYSE: F, Bullboard) needs little introduction. Aside from its eponymous line of Ford vehicles, the company also produces Lincoln and Mercury, owns a 33% stake in Mazda (OTO: MZDAF, Bullboard), and controls Volvo (OTO: VOLVY, Bullboard). In the past couple years, Ford sold its Hertz (NYSE: HTZ, Bullboard) line of car-rental locations and is in the process of selling Land Rover and Jaguar to India-based Tata Motors (NYSE: TTM, Bullboard) for a reported $2.3 billion.
While rising crude oil prices and pressures at the pump have turned consumers away from the company’s line of SUVs and award-winning pickup trucks, Ford is in the early stages of a turnaround masterminded by CEO Alan Mulally. In April, total auto sales retreated 12.2% to 200,727 cars and trucks. However, while truck sales plunged 18.3%, the new Focus compact saw sales spike 43.5% from a year ago. What’s more, Fusion sedan sales rose 22.4%.
The turnaround is also apparent in the company’s quarterly earnings reports. On April 24, Ford announced that it swung to a first-quarter profit of $100 million, or five cents per share, due to cost reductions in North America and strong international profits. Analysts were looking for a loss of 15 cents per share. Many analysts touted the results as proof that Mulally’s plan is on track. Ford also said it bought out 4,200 hourly workers during the quarter as part of its ongoing restructuring plan.
These strengthening fundamentals are also having an impact on Ford stock. Since the beginning of the year, F has risen more than 21%, easily outpacing the S&P 500 Index’s loss of more than 4%. During this time frame, the equity has enjoyed the support of its 10-day and 20-day moving averages – trendlines that F has not closed a session below since March 19.