NEW YORK (TheStreet) -- Ford (F) - Get Report shares are down 0.95% to $15.06 in morning trading on Thursday after the company's new aluminum-bodied F-150 pickup passed its Insurance Institute of Highway Safety crash test, but raised concerns about the cost of repairs and its overall safety.
The vehicle received a "good" rating from the testing agency, but was given a "marginal" performance grade.
The test indicated that the crash test dummy in the vehicle showed that there would be moderate risk of injuries to drivers involved in a 40 mile per hour partial head on collision crash.
"Ford added structural elements to the crew cab's front frame to earn a good small overlap rating and a Top Safety Pick award, but didn't do the same for the extended cab. That shortchanges buyers who might pick the extended cab thinking it offers the same protection in this type of crash as the crew cab," said IIHS chief researcher David Zuby.
Ford said that it plans to add extra steel in all its F-150 versions in the coming model year, according to Bloomberg.
"From a simple bolt-on parts replacement to a more-involved removal and installation of entire body panels, fixing the aluminum F-150 is more expensive than repairing a steel-body F-150," Zuby said.
Ford officials noted that the same model F-150 received the top "5-star" rating in crash tests conducted by the National Highway Traffic Safety Administration.
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 a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. Among the primary strengths of the company is its generally strong cash flow from operations. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Net operating cash flow has slightly increased to $2,413.00 million or 8.69% when compared to the same quarter last year. Despite an increase in cash flow, FORD MOTOR CO's cash flow growth rate is still lower than the industry average growth rate of 24.21%.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 6.0%. Since the same quarter one year prior, revenues slightly dropped by 5.5%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- FORD MOTOR CO' earnings per share from the most recent quarter came in slightly below the year earlier quarter. 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 ($1.59 versus $0.78).
- The gross profit margin for FORD MOTOR CO is rather low; currently it is at 18.58%. 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 2.72% trails the industry average.
- 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 on the basis of return on equity, FORD MOTOR CO has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
- You can view the full analysis from the report here: F Ratings Report