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Ford stumbles on stock weakness and disappointing outlook among others

(FinancialPress) — Ford Motor Co.‘s (F) Q4 earnings report is expected to reveal a rough-and-tumble closing to 2017 for the company, mostly due to its low stock performance and a weak guidance. The report results are expected on Wednesday, after trading hours.

Earlier this month, Ford released its guidance. The forecast was not well received by Wall Street, where analysts already assumed a defensive stance and will surely dissect the upcoming earnings report for signals of safety against the potential storm to come.

The positives for Ford highlight its great sales performance with its trucks and SUV products – vehicles that U.S. consumers have distinctly taken a preference for in the last years instead of compacts and sedans. The company also aims to launching compact SUVs in 2018 – a segment it doesn‘t currently exploit and also one that has grown significantly in recent times.

“That’s where the profits are, and where the volumes are,” said Efraim Levy, an analyst with CFRA.

Ford has been striving to play catch-up with local rival General Motors Co. (GM), which has thus far earned the favor of Wall Street investors with its most recent moves – selling off its European business and hitting the gas in electric vehicle development. The changes required to keep up have hurt Ford‘s profitability, said Levy.

Ford can expect some upward thrust once it executes its investments in electric vehicles/mobility, and manages to concrete its inner-workings cost-restructuring.

The 3 major points to keep an eye on once the report comes out are

Earnings: a FactSet survey reveals analysts expect Ford to report adjusted earnings of $0.44 per share in the quarter.

Revenue: the survey reveals a consensus revenue expectation of $36.3 billion – down from 2016‘s Q4 $38.7 billion earnings.

Stock Reaction: Ford‘s stock has lost 4% in the past 12 months. It is now close to its 4-month low and experienced a rather weak December. This contrasts starkly against the major indexes‘ performances for 2017.

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