NEW YORK (TheStreet) -- Ford Motor (NYSE:F) has been reiterated by TheStreet Ratings as a buy with a ratings score of B. Among the primary strengths of the company is its respectable return on equity which we feel is likely to continue. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
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- F, with its decline in revenue, underperformed when compared the industry average of 9.7%. Since the same quarter one year prior, revenues slightly dropped by 2.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Automobiles industry and the overall market, FORD MOTOR CO's return on equity significantly exceeds that of both the industry average and the S&P 500.
- FORD MOTOR CO's earnings per share declined by 42.6% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, FORD MOTOR CO increased its bottom line by earning $5.01 versus $1.59 in the prior year. For the next year, the market is expecting a contraction of 70.0% in earnings ($1.50 versus $5.01).
- The share price of FORD MOTOR CO has not done very well: it is down 22.49% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, although the push and pull of the overall market trend could certainly make a critical difference, we do not see any strong reason stemming from the company's fundamentals that would cause a continuation of last year's decline. In fact, the stock is now selling for less than others in its industry in relation to its current earnings.
- The gross profit margin for FORD MOTOR CO is rather low; currently it is at 20.00%. It has decreased from the same quarter the previous year. Regardless of the weak results of the gross profit margin, the net profit margin of 4.30% is above that of the industry average.
--Written by a member of TheStreet Ratings Staff. TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
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