General Motors, Ford, Stellantis second-quarter earnings: analysts expected | Wilnesh News

DETROIT – Wall Street Expectations General Motors Detroit’s biggest automaker stood out among traditional automakers when it reported second-quarter results this week, with first-half sales and vehicle prices holding steady.

GM is expected to report solid adjusted profit of $2.75 per share, up 44.2% from a year earlier, on revenue of $45.46 billion, up 1.6% from a year earlier, according to average analyst forecasts compiled by Financial Markets Data & Analytics .

Compared to estimates from LSEG Ford Adjusted earnings per share in the second quarter are expected to be 68 cents, down 5.2% from the second quarter of 2023. According to LSEG, Ford’s revenue is expected to increase 3.8% year-on-year to $44.02 billion.

General Motors reports earnings before the market opens on Tuesday. Ford is scheduled to report earnings after the market closes Wednesday afternoon, with Chrysler parent company not far behind StrantisThe company reports earnings biannually, releasing first-half results on Thursday morning.

Several Wall Street analysts expect GM to move toward the high end of the automaker’s already-raised 2024 guidance, even if it doesn’t raise it again as part of its second-quarter results. There’s no consensus on the prospects for Stellantis and Ford.

Barclays analyst Dan Levy said in a July 15 investor note: “We expect strong second-quarter results from Ford and General Motors driven by favorable pricing; sales/ The product mix will favor Ford, while GM should benefit from easy cost comparisons. “Both are expected to improve their 2024 guidance. “

Evercore analyst Chris McNally remains “positive on GM (particularly Ford),” citing the automaker’s lower pricing. However, Evercore still expects Ford’s second-quarter results to be “solid,” near the top half of its previously announced 2024 guidance.

Ford’s guidance for the year includes adjusted earnings before interest and taxes (EBIT) of $10 billion to $12 billion and free cash flow of $6.5 billion to $7.5 billion.

GM’s 2024 guidance calls for adjusted earnings of $12.5 billion to $14.5 billion, or $9 to $10 per share, and adjusted auto free cash flow of $8.5 billion to $10.5 billion.

Citi analyst Itay Michaeli said in a July 11 note to investors that “both companies are expected to report solid quarterly results or either confidently affirm prior guidance (i.e., the upper end of the range), Or a modest upward revision.

With its main operations in North America and Europe, Stellantis is in a different position than its competitors.

The transatlantic automaker is expected to report adjusted operating profit in the first half of this year, but investors are concerned about its North American operations.

The company is correcting what Chief Executive Carlos Tavares called the region’s “arrogant” mistakes that led to falling sales, bulging inventories and investor concerns. The comments were made during an investor event last month.

Despite these issues, Stellantis finance director Natalie Knight said June event period The company’s adjusted operating profit margin in the first half of the year will be between 10% and 11%.

She also reiterated Stellantis’ 2024 guidance, which includes double-digit adjusted operating margin, positive industrial free cash flow and at least 7.7 billion euros ($8.4 billion) of capital available to investors in the form of dividends and buybacks Return.

Stellantis shares will be down more than 12% in 2024, while GM shares are up 36% and Ford shares are up about 18%.

Tavares noted that Stellantis has three problems: too slow to sell vehicle inventory; manufacturing issues, specifically at two unnamed factories; and a lack of “sophistication in the way it goes to market.”

Stellantis, which owns brands such as Jeep and Ram in the United States, expects revenue to fall 11.3% annually to 45.37 billion euros ($49.39 billion), according to LSEG.

Analysts still expect Stellantis to be profitable in 2024, with adjusted earnings of $4.82 per share expected. However, this would be an 18.9% decrease from last year.

For GM, Ford and Stellantis, investors will be watching for updates on their electric vehicle plans, capital spending and rising U.S. new-vehicle inventory levels

“We believe that despite some normalization, the dynamics of the U.S. auto cycle can still support strong (automaker) earnings flows and healthy pricing dynamics can be maintained,” Barclays’ Levy said. However, inventory levels have risen… We believe rising inventory levels need to be monitored as increasing negative data points could put pressure on (automaker) inventories.”

—CNBC Michael Bloom contributed to this report.