Ford (F) Stock Drops Today on Weak February Sales
NEW YORK (TheStreet) -- Ford Motor Co. (F) - Get Report shares are down 1.87% to $16.26 in early market trading on Tuesday after the U.S. auto company reported a 1.9% year over year drop in February auto sales today.
Total vehicle sales fell to 180,383 units from 183,947, with car sales falling 8.1% and SUV sales falling 2.3%. Ford trucks continue to be the company's bellwether product as a 4% rise in truck sales was a bright spot for the Dearbon, MI-based company.
Exclusive Report:Jim Cramer's Best Stocks for 2015
Ford Transit Connect sales jumped 24.6% while heavy truck sales climbed 18.7%, though the company's popular F-series models saw a 1.2% decline in sales. Despite the decline in F-series sales, the company's popular F-150 continued to be one of its best sellers in the period.
"Strong customer demand for the all-new F-150 drove strong February F-Series retail sales results in February. The all-new F-150 continues to be the hottest vehicles on dealer lots, turning more than four times faster than the industry's overall full-size pickup segment," said Mark LaNeve, Ford VP, U.S. Marketing, Sales and Service.
Ford Explorer sales were also a bright spot for the company with the segment increasing sales by 32% to 17,027 vehicles sold in February, the best month for Explorer sales since 2006.
TheStreet's Jim Cramer believes that Ford will be outperformed by rival GM (GM) - Get Report this year.
"We expect GM to continue to outperform Ford this year, because of its stronger product mix and easy comparisons, against last year's ignition issue and multiple recalls," wrote Cramer in a blog last month.
TheStreet Ratings team rates FORD MOTOR CO as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate FORD MOTOR CO (F) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Net operating cash flow has significantly increased by 588.25% to $2,168.00 million when compared to the same quarter last year. In addition, FORD MOTOR CO has also vastly surpassed the industry average cash flow growth rate of -24.72%.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 10.1%. Since the same quarter one year prior, revenues slightly dropped by 4.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- FORD MOTOR CO has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, FORD MOTOR CO reported lower earnings of $0.78 versus $1.75 in the prior year. This year, the market expects an improvement in earnings ($1.58 versus $0.78).
- Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- The gross profit margin for FORD MOTOR CO is rather low; currently it is at 16.65%. Regardless of F's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 0.14% trails the industry average.
- You can view the full analysis from the report here: F Ratings Report