Ford Motor Co.’s stock rose on Friday, with Wall Street forecasting a quarterly loss of nearly $ 3 billion and a loss of sales to focus on the automaker’s plans to invest more in electric and self-driving cars.
Ford F,
on Thursday, it reported a greater loss in the fourth quarter and quarterly sales that were below Wall Street expectations, but revealed a more optimistic outlook for the first quarter and said it would almost double its investments in electric and autonomous vehicles.
“We are very encouraged” by them, said Emmanuel Rosner of Deutsche Bank in his note on Friday.
The company’s operating performance in the second half of 2020 and the 2021 orientation “suggest that the company may be turning a page with its profitability and cash generation, benefiting from new and renewed products, strong mix and prices and global cost reductions and efficiencies, “he said.
Ford’s plan to invest in EVs and self-driving cars has risen to $ 29 billion, including $ 22 billion for EVs by 2025. This shows that Chief Executive Jim Farley “is really accelerating the company’s transformation toward a future electrified and connected ”.
Read: Electric vehicles will account for a larger share of US retail auto sales, says Edmunds
Ford is taking “bolder and more decisive actions in the EV (and AV),” Joseph Spak of RBC Capital said in his note. Ford “is ‘pulling a GM’ and increasing investment. This is absolutely necessary. “
Ford’s valuation of about $ 45 billion has been eclipsed by Tesla Inc.’s TSLA,
$ 800 billion and GM from General Motors Co.,
$ 79 billion. Tesla, of course, only makes electric vehicles, and GM has pledged to do the same by 2035 and become a carbon neutral company by 2040.
A unifying concern with Ford, however, was news that the production of the new F-150 pickup, the number one vehicle sold in the United States for consecutive decades and one of the company’s crown jewels, was being hampered by the lack of chips. The company has temporarily reduced factory shifts.
Ford targeted 2021 adjusted earnings before interest and taxes of around $ 7.1 billion and $ 8.1 billion, which was “decent” considering the chip shortage, said Morgan Stanley’s Adam Jonas, on a note.
Ford shares have gained 40% in the last 12 months, compared to gains of around 17% on the S&P 500 index. SPX,