Sector Snap: Automakers mixed after Toyota profit falls

The automakers posted mixed results Thursday, after Toyota Motor Corp. reported a 28 percent plunge in fiscal fourth-quarter profit, blaming a strong yen and weak U.S. sales.

The drop marked Toyota's first quarterly profit decline since the 2002 fiscal year. The Japanese automaker also projected a 27 percent drop in profit for the current fiscal year.

Meanwhile, officials for Ford Motor Co. told shareholders at the Dearborn, Mich.-based automaker's annual meeting that their plan to return to profitability next year is taking hold.

Chief Executive Allan Mulally acknowledged that while the slowing U.S. economy will make things tough, Ford has worked to reduce costs in North America and adjusted production levels in response.

In midday trading, Toyota's U.S. shares fell $4.42, or 4.2 percent, to $100.34 after dropping as low as $99.25 earlier in the day. Ford shares rose 19 cents, or 2.4 percent, to $8.15 after peaking at $8.18.

Shares of Detroit-based General Motors Corp. fell 22 cents to $21.18, while Honda Motor Co.'s U.S. shares fell 70 cents, or 2.2 percent, to $31.68 and Nissan's U.S. shares fell 15 cents to $18.21.

Citi's Noriyuki Matsushima said Toyota's quarterly results and 2009 guidance weren't a big surprise and backed his "Hold" rating for the company.

"Not only do we consider Toyota highly cost-competitive in established areas, we believe it also has a strong lead over competitors in commercializing new technologies, such as hybrid cars and the G-Book (telematics)," Matsushima wrote in a note to investors.

"Toyota's expansion of its global production network in Europe, North America, Asia, and elsewhere is beginning to produce results, and we anticipate considerable earnings contributions in the coming years."