Ford Motors Q4 2017 Earnings Preview

Ford Motor Company (NYSE: F) will report its fourth quarter and full year 2017 earnings on Wednesday January 24^th 2018 and while the company’s SUV sales are growing the company has given a disappointing outlook for 2017 and 2018 at a recent investor conference.  According to Ford, higher costs of raw materials are likely to impact the profitability of the company going forward. Ford estimates that these rising costs could cost the company $1.6 billion in 2018 and while it is working on cost cutting initiatives, it might take a while for the impact of these measures to be felt.  The company is likely to restructure its South American business and focus more on trucks and SUVs which are likely to be profitable in the future. (Read Will 2018 Be A Positive Year For Ford Motors?). In 2017, Ford’s F-series registered a more than 9% increase making it the best year for this model after 2005. Similarly SUV sales have been positive in the last quarter. However, as indicated by the company, despite strong sales, increased costs are likely to impact the profitability for 2017 and 2018.

Consensus analyst estimates for revenue and EPS (earnings per share) of Ford Motors are strong and EPS is likely to witness a more than 40% growth year on year. The below chart summarizes Ford Motors’ revenue growth and EPS growth in the past two quarters and expectations for Q4 2017.

You can click here to access these charts and modify the numbers.

Ford Motors is investing heavily on electric vehicles and it appears that increased focus on trucks and SUVs might lead to higher raw material costs. While the next couple of years appear to be grim and the company needs to take several measures for an effective turnaround, it is investing for a brighter future.

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