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Ford Leaps After Carmaker Sees 'Significantly Better' Second-Quarter Earnings

Ford says Thursday that second-quarter earnings will 'surpass expectations and be significantly better than a year ago.'

Ford Motor  (F) - Get Report said Thursday that its current-quarter earnings will exceed forecasts even as it cautioned on the uncertainty linked to a global shortage in semiconductor supplies.

In a statement ahead of a Deutsche Bank Global Auto Industry Conference later Thursday, Ford said second-quarter earnings will "surpass expectations and be significantly better than a year ago", thanks in part to lower-than-expected costs and "favorable market factors". Net income, Ford said, will be "substantially lower than a year ago", however, owing to a $3.5 billion gain that was linked to its investment in Argo AI. 

Ford will publish its second-quarter earnings on July 28.

"We're providing customers with great value today and there's much more on the way, because we're executing Ford+ from strength - with iconic nameplates and leading positions with retail and commercial customers around the world, and the best financing company in our industry in Ford Credit," CEO Jim Farley said in a statement.  

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Ford shares were marked 3.1% higher in pre-market trading Thursday following the investor update to indicate an opening bell price of $15.48 each. 

General Motors  (GM) - Get Report, Ford's larger rival, also said it sees "significantly better" second quarter earnings after accelerating the production of large and medium-sized pickups in the United States, following several plant shutdowns linked in part the global shortage in semiconductor supplies, on June 3.

Earlier this month, JPMorgan analyst Ryan Brinkman lifted his price target on Ford by $2, to $18 per share -- the highest on Wall Street -- while holding his 'overweight' rating in place, after Ford said it will boost investment in EVs to at least $30 billion by 2025, and vowed to have 40% of its fleet fully electric within the next decade. 

Ford also said it would deliver an 8% adjusted profit margin - a long held goal for the carmaker - by 2023.

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