Ford’s US Sales Decline 9.8% In 4Q; Street Says Hold

Ford Motor Co. announced that it sold 542,749 vehicles in the US during the fourth quarter, reflecting a decline of 9.8% year-over-year. Meanwhile, its US retail sales slipped 3.4% during the same period.

Ford’s (F) truck sales fell 12.5%, while car sales plunged 41.1%. However, SUV sales improved by 4% during the quarter.

The company said that lower F-150 inventories due to the production stoppage amid the coronavirus pandemic took a toll on Ford brand sales, which decreased by 10% year-over-year. Meanwhile, Lincoln brand sales witnessed a decline of 7% during the quarter.

While 4Q sales remained weak, the company said that December retail sales increased by 5.3%. The launch of the new F-150, Mustang Mach-E, and Bronco Sport contributed to the growth. (See F stock analysis on TipRanks)

On Dec. 21, Benchmark analyst Michael Ward raised the stock’s price target to $12 (35.9% upside potential) from $11 and maintained a Buy rating.

Ward said that improving industry fundamentals in North America, inventory replenishment, and new vehicle launches will boost Ford’s earnings in 2021. Meanwhile, he expects further improvement in earnings in 2022.

Overall, the consensus among analysts is a Hold based on 9 Holds, 3 Buys and 1 Sell. The average price target of $9.35 suggests that Ford shares have upside potential of around 5.8% over the next 12 months. Shares have retreated about 2.4% over the past year.

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