The Ford Motor Company (NYSE: F) started 2020 with quite a bit of confidence shortly after completing an entire overhaul of its corporate structure that was meant to help Ford become more competitive in a market where it seems to be dominated by automobiles that are both smart and clean. A lot of investing is also getting poured into innovating new ideas so that the competition can be kept in check.
As part of this corporate renovation, Ford has begun the planning of relaunching some of its most popular models. A few of these relaunches include the Ford Bronco and F-150. On top of these relaunches, Ford is also undertaking endeavors by partnering with other manufacturers such as Mahindra, Rivian, and Volkswagen in order to create a stronger presence globally.
Despite these positive efforts, Ford has continued to face financial trouble due to a frail market and the increased tensions with China. Also, their shares have felt a big punch due to the ongoing pandemic.
Recent Stock Earnings
Luckily, Ford’s stock was able to surpass what was assumed for the earnings in Q2. In July, Ford announced a 35 cent drop in share price upon $16 billion revenue.
Back in April, investors and shareholders were unimpressed with Ford’s earnings. This was in light of the CFO predicting a staggering $5 billion loss for the second quarter. However, this was adverted to just a $2 billion loss because of the additional manufacturing facilities that recently opened.
Recent Ford News
Currently, the Ford stock holds a buy point of 7.16. However, a significant slap in the face was felt as soon as the coronavirus hit the market. What’s worse is that the share’s buy point sat lackluster prior to the pandemic.
Up until now, Ford shares have had a noticeable increase in purchases. This increase was mainly due to the stocks being made up entirely of value names and less growth as the coronavirus hit.
Besides the rotation, its move in July occurred at the same time as Ford’s Bronco announcement was made.
New CEO Appointed and Bronco/F-150 Take Center Stage
Recently, Ford made it official by appointing the current COO Jim Farley to head Ford as its chief executive officer. Mr. Farley takes over the helm from CEO James Hackett on the 1st of October.
Mr. Hackett had struggled to show positive results during his tenure at Ford. At the heart of it all was his plan to restructure Ford that had a price tag of $11 billion. Unfortunately, this strategy experienced many setbacks due to the careless redesign and roll out of their 2019 Explorer.
Not only that, but Ford’s stock price fell close to 40% from the time that Hackett was made CEO three years ago.
Shareholders were pleased to hear the change in leadership, which made the Ford share price rise as soon as it was announced.
Besides an executive changeup, Ford also made it official by revealing it would be bringing the Ford Bronco back into production.
The Bronco manufacturing will involve the production of their two and four-door model, along with a Sport model. The Bronco rollout is planned to take place before January 2021.
The purpose of the Bronco’s resurrection is a part of Ford’s plan to take advantage of a brand that was once an American icon in order to improve and increase earnings within the U.S.
Ford’s re-release of the Bronco is also meant to be a direct competition towards the Jeep lineup.
Along with the reintroduction of the Bronco, Ford also let it be known that a redesigned F-150 will also be unveiled. The Ford F-150 truck is also going to be the manufacturer’s first model to utilize the over-the-air software that Tesla had developed.
Should You Take Advantage of Ford Stock?
There are so many things causing Ford’s inability to bounce back financially in terms of stability such as revenue and earnings, as well as the multi-billion dollar restructuring. However, regardless of the gains being short or long-term, Ford shares continue to head downward like it was witnessed in 2013 or even as far back as 1999.
What it all boils down to is the fact that it is better to wait to buy shares if you are looking for consistent growth.