Why Ford's Stock Could Pop on Earnings

Ford (NYSE: F  ) really had a remarkable first quarter and as a shareholder I can't wait to hear the conference call on April 24. There will be plenty of good things for management to highlight for analysts and media alike. Let's break it down into its simplest form by checking out the facts on popular vehicles driving revenues, and assess whether Ford's stock will pop on the news.

F-Series
The F-Series is the single most important vehicle for Ford and its bottom line – hands down. Ford's truck is the No. 1 selling vehicle in North America and it brings in more margin and bottom-line profits than any other model. It's been said that it could represent up to 60% of Ford's total profits. As the truck sales go, the bottom line follows.

That's good news for Ford investors because it's sold phenomenally well in the first quarter. The follow numerical facts are compared versus prior year: January, F-Series hauled in an impressive 22% gain; February, F-Series posted a 15% gain; March finished the quarter strong with a 16% gain. Folks, these are impressive gains because in 2012 the F-Series sold very well and represented almost 30% of Fords total sales. Look for the F-Series to beef up Fords first-quarter bottom line.

Escape
There is quite a bit of excitement for the Escape, and it's well-deserved. It's been a popular model here in the U.S. and its twin – the Kuga – in China is enjoying huge demand. Here are the facts, and again the numbers are versus prior year: January, the Escape posted a 16% gain; it followed that with an all-time record February, up 29%; March even topped that with a 28% increase, and the units sold represent the best sales month in the Escapes 13 year lifespan. 

All the rest
As I write this I'm beginning to realize there are too many good Ford vehicles and sales numbers to give you in one article. If you had told me that would be the case in 2006, I would have laughed you out of the room. So here's a short wrap-up of a handful of other Ford vehicles.

The Focus sold over 1 million vehicles in 2012, and continues to sell at a screaming pace globally. The Fusion – which has won an incredible amount of awards – sold over 80,000 vehicles in the U.S. in the first quarter, a 26% increase over last year. The popular sedan can't even be produced fast enough to keep inventory on the dealer lots! The Explorer almost topped 50,000 and is good for a 44% increase. Overall, the Ford brand has surged 12.4% compared to the first quarter of 2012 – and is led by its most profitable products.

I can't sum the first-quarter results in any other word than "impressive". I'm extremely glad to be a shareholder and happy Ford represents a huge chunk of my portfolio. If Ford's losses in Europe aren't greater than expected, I think Ford's stock price could pop on April 24.

Worried about Ford?
If you're concerned that Ford's turnaround has run its course, relax -- there's good reason to think that the Blue Oval still has big growth opportunities ahead. We've outlined those opportunities in detail, in the Fool's premium Ford research service. If you're looking for some freshly updated guidance to Ford's prospects in coming years, you've come to the right place -- click here to get started now.


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  • Report this Comment On April 11, 2013, at 3:49 PM, mistacy wrote:

    I see all the positives & agree with you that F is due to pop. In my experience though, F has more than often dropped on good news. We will see what happens this earnings call. Regardless, F is way undervalued.

  • Report this Comment On April 11, 2013, at 3:52 PM, TMFTwoCoins wrote:

    I know what you mean, even though I guarantee a great quarter report it might drop if the losses in Europe are simply worse than expected. We know it'll be bad, and I argue that the difference between losing 500 million and 600 million is negligible. But it will probably drop on the short term garbage if that happens.

    Either way, I've just been picking up more shares if macro-events cause it to drop because the company itself is only improving.

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