Ford Stock News and Forecast: Shares drop 6% in premarket after earnings

Ford stock down 5.8% in premarket after earnings report.
F stock price rose 136% in 2021.
Ford's Q4 earnings miss on top and bottom lines.

Clay Webster FXStreet

Ford (F) stock has not taken the company's earnings news in stride, and shares of the automaker are down 6.1% in Friday's premarket. On Thursday after market close, the company reported normalized (non-GAAP) earnings per share of $0.26, which was way below expectations for $0.41. Revenue also missed with Ford's sales of $35.26 billion missing Wall Street projections by $365 million.

Ford Stock News: one bum quarter

Until Thursday, Ford had been living its best life. In January Ford stock achieved its highest share price in two decades. The company's move into electric vehicles had transformed the moribund automaker into a hot stock, and F shares ran up 136% in 2021 and even more so in January of this year.

It seems that Wall Street thought financials would tag along with investors' newfound enthusiasm, but that is not the case. Ford produced $2 billion in operating income in Q4. The Street had expected $2.8 billion.

Deutsche Bank, which had called Ford one of its top picks in the automotive sector for 2022 just a month ago, lowered its price target from $24 to $21 after the earnings news.

The company said it had faced supply constraints during the quarter, especially from a lack of semiconductor chips.

Ford announced three weeks ago that it would double production of its Ford F-150 Lightning, it first foray into the EV truck market. Management said that it would raise production of its Lightning EV model to 150,000 units a year by 2023. The storied automaker already has 200,000 reservations for the EV truck.

In Thursday's call, management said they now have 275,000 reservations between the F-150 Lightning, Transit vans and the Mustang Mach-E – all electric vehicles. They expect to produce 600,000 electric vehicles in 2023.

CEO Jim Farley was named MotorTrend's 2022 Person of the Year in mid-December.

Ford key statistics

Market Cap	$82 billion
Price/Earnings	11
Price/Sales	0.6
Price/Book	2.2
Enterprise Value	$197 billion
Operating Margin	2%
Profit Margin	2%
52-week high	$25.87
52-week low	$9.82
Short Interest	2%
Average Wall Street Rating and Price Target	Hold, $20.64

Ford Stock Forecast: F shares drop below $19 support

Ford stock has dropped below support at $19 in the premarket on Friday. If it does the same in the regular session, then traders should expected F shares to fall further in the coming days to $16.55. This is support from October 2021.

The 9-day moving average seems to have professied this drop as it crossed below the 21-day moving average on January 26. Below $16.55 sits some support around $15.50.

To become enthused about Ford stock once more, shares will need to climb above $21 – the range high from February 2. It is also better to wait for a crossover on the Moving Average Convergence Divergence (MACD) indicator, which at the moment is continuing its descent.

Ford 1-day chart

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Author

Clay Webster

FXStreet

Clay Webster grew up in the US outside Buffalo, New York and Lancaster, Pennsylvania. He began investing after college following the 2008 financial crisis.

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