This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Ford: Commodities Won't Hurt Profit

DETROIT (TheStreet) -- Despite rising commodity prices, Ford (F)said Tuesday that it is willing to project it will be "solidly profitable" during the current year.

The automaker had been projecting profits in 2011 but had been less clear about 2010. But during an earnings conference call, CFO Lewis Booth declared, "We feel very good about giving guidance, which would be solidly profitable this year, which is an adjective we'd used (regarding) next year. So we've pulled ahead the adjective.

"Given where we were three months ago, we're really encouraged," Booth noted. During the first quarter, Ford produced profits in every segment and improved its net income by $3.5 billion. CEO Alan Mulally said the positive results were "absolutely a manifestation of the strength of our products, the breadth of them -- we're seeing so many new customers." Strong products are "what people really want, in addition to buying from a strong company," he said.

Despite the strong results, Booth reiterated several times during the call that Ford faces a headwind from rising commodity costs. "We do expect to see some bad news on commodities," he said. "It's meaningful, but we're not giving out specific details." On Monday, Toyota (TM) executives said steel-price negotiations with Japanese steelmakers would take longer, with the steelmakers seeking price hikes and Toyota unable to raise prices.

Besides commodity-price rises, said Booth, Ford faces price increases in 2011 as it strives to maintain a best-in-class product line, which "does in some cases require some additional product costs." However, he noted, "we've seen the benefit of that in terms of incremental revenue."

At midday, Ford shares were trading down 92 cents at $13.54. At midmonth, Ford ranked second on the NYSE list of the top 100 shorts, with 259 million short positions. Ford shares rose 335% in 2009 and are up about 33% in 2010, which they began at $10.17.

In the first quarter, excluding items, the automaker said its pretax operating profit was $2 billion or 46 cents a share. Analysts surveyed by Thomson Reuters had estimated 31 cents. Revenue rose 15% to $28.1 billion. Analysts had estimated $30.4 billion.

In the same quarter a year earlier, excluding items, the pre-tax loss was $2 billion or 75 cents a share. Ford's pretax profit was its highest quarterly pretax operating profit in six years, and represented a $4 billion improvement from a year earlier.

-- Written by Ted Reed in Charlotte, N.C. .

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,960.57 -123.23 -0.72%
S&P 500 1,978.34 -9.64 -0.48%
NASDAQ 4,449.5640 -22.5440 -0.50%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs