Ford Shares Drop as Profit Misses Expectations

0
91

Ford Motor Co.’s (NYSE: F) profit rose sharply in the third quarter, but still failed to hit analyst estimates. Higher taxes offset rising profits from the car maker’s new aluminum-bodied F-Series of pickups. Shares dropped 4% on the news.

Net income for Ford doubled from $835 million the previous year to $1.9 billion in the third quarter. Despite this, the $.45 a share earnings were below analyst estimates of $.47. Shares were trading at $15.05 Tuesday morning, the lowest level in two months.

Over the last two years, Ford has been overhauling two factories that assemble the F-150 to improve efficiency of fuel economy. Ford also cut 700 pounds from the model’s weight by using aluminum body panels.

Sales for the brand’s F-series trucks jumped 16% in September, which caused the company’s shares to rise. During the month of October, the stock gained 16% and closed at $15.60 on Monday. Overall, Ford’s stock has increased 1.2% in 2015.

According to Ford CFO Bob Shanks, the earnings-per-share miss was due entirely to a tax rate difference. As far as operating results, the company was right on target, but they were subjected to a 33% tax rate. Analysts predicted a 32% tax rate on average.

LEAVE A REPLY

Please enter your comment!
Please enter your name here