Ford’s profits took a huge hit from Rivian. Wall Street is happy anyway.

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Ford Motor

mentioned first quarter earnings That modestly exceeded Wall Street estimates. The outperformance wasn’t much, but the quarter appears drama-free, and that was enough for investors during a year full of drama.

Ford (Ticker:F) reported earnings per share of 38 cents and operating profit of $2.3 billion from $34.5 billion in sales. Wall Street was looking for EPS of about 37 cents and operating profit of $2.1 billion from $34.5 billion in sales.

Involved above.

Ford’s operating profit margin for its North American division came in at 7.1% — the same margin as the fourth quarter of 2021. That’s an achievement given rising costs and supply chain crises.

a year ago, the auto manufacturer reported earnings per share of 89 cents and operating profit of $4.8 billion from $36.2 billion in sales. That quarter included gains on Ford’s stake in

Rivian Cars

(countryside).

Ford determines market share each quarter, so Ford had to admit a $5.4 billion loss related to Revan based on the value of the electric car maker at the end of March. Rivian shares closed the year at about $104 but finished the first quarter at about $50.

Ford owns about 102 million shares in Rivian.

The charge is great, but it’s not a surprise. Rivian stock hasn’t stopped falling either. It closed Wednesday at $31.22 per share. Analysts and investors have sold more speculative and high-growth stocks in response to higher interest rates, reducing the current discounted value of future earnings. Rivian also has his own issues intensification of production.

Ford’s guidance for 2022 has not been completely changed in its earnings release. Back in March, Ford management said operating profit for 2022 would fall between $11.5 billion and $12.5 billion and that free cash flow would be about $6 billion.

Ford stock was up 2.6% in after-hours trading after rising 0.5% to $14.78 in the regular session. The Standard & Poor’s 500 And Dow Jones Industrial Average Both are up about 0.2%. During Wednesday, Ford’s stock is down about 29% since the start of the year.

Most auto stocks have struggled. And General motors (GM), for example, is down 34% since the beginning of the year. First-quarter earnings turned out to be better than feared.

Tesla

(TSLA) reported first-quarter earnings of $3.22, while Wall Street was looking at nearly $2.30. GM mentioned Earning $2.09 per share; Analysts had expected $1.65.

For the whole of 2022, Wall Street forecasts still lag behind Ford’s guidance. Before the latest numbers were released, analysts were expecting about $11.2 billion in operating income and $4 billion in free cash flow, according to FactSet. Analyst calls are usually well below management guidance.

General Motors, for example, expects operating profit for 2022 to fall between $13 billion and $15 billion. Wall Street currently expects operating profit from General Motors to reach $13.8 billion. That gap between what analysts expected and what management has now said is one factor that could help Ford’s stock on Tuesday.

options markets It means the stock will move about 9%, up or down, after earnings. Shares have moved about 7% or 8%, up or down, on average after the past four quarterly reports.

Ford Scheduled Management A conference call 5 p.m. ET to discuss the results. Analysts and investors will be keen to know production rates for the remainder of the year given the industry’s supply chain issues.

loss Semiconductors It restricted global auto production for more than a year. Ford delivered about 432,000 cars in the United States during the first quarter of 2022. A year ago, in the first quarter of 2021, this number was about 531,000.

Write to Al Root at [email protected]