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Why Ford's Stock Could Pop on Earnings

By Daniel Miller - Apr 11, 2013 at 3:00PM

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Investors in the Blue Oval have a ton of things to be excited about. Its product quality is changing consumer attitudes and record sales are following. The company is very profitable, even with losses in Europe. I think the first quarter results will be good enough for the stock price to pop, and here's why.

Ford (F 2.49%) 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.

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.

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.

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