Ford Earnings: Pricing Eases Damage From UAW Strike

Ford’s stock rose by over 6% in Feb. 6 afterhours trading after the firm reported a good fourth quarter despite the United Auto Workers strike costing about $1.6 billion in lost quarterly profit. Adjusted diluted EPS of $0.29 far exceeded the $0.14 LSEG consensus but fell 43% year over year, while adjusted free cash flow excluding Ford Credit was still $2 billion, down from $2.4 billion. We are not changing our fair value estimate but will reassess all modeling inputs shortly after the 10-K is filed. Ford initiated 2024 guidance of total company adjusted EBIT between $10 billion and $12 billion, which at the midpoint is down from 2023’s $12.1 billion excluding the full-year $1.7 billion strike impact. We agree with management’s assumption for the year of flat to modestly higher U.S. industry auto sales and lower pricing than in 2023. Ford expects a 2% pricing decline and capital spending of $8 billion to $9.5 billion with 40% of that on electric vehicles.