Friday, April 26, 2019

Earnings Season, 1Q19 -- Making America Great

I don't know if folks are paying attention, but the earnings season has been incredible. A few companies have had some poor results but for the most part, not only have earnings been good, but they have been very, very, very good.

And some of the commentary -- I love it.

For example, Ford. Link here.

People have driven a Ford truck lately.
And that — along with progress on a deep cost-cutting initiative by Ford CEO Jim Hackett — will likely leave investors encouraged on Ford’s outlook, finally.
The maker of the popular F-Series line of trucks said Tuesday it gained market share and grew revenue in its pickup truck category in the first quarter.
With F-Series pickups being some of the highest margin products rolling off Ford’s assembly lines, it helped power profits in North America $300 million higher from a year ago. Strength in the equally high margin SUV category also supported Ford’s North American profits.
Ford benefited in the quarter from the introduction of the newly redesigned mid-size Ranger pickup. The momentum for Ford is a kick to the gut of rivals General Motors and Fiat, both of which released new designs for their full-size pickups last year in an effort to dethrone the F-Series. Ford plans to release a new Super Duty pickup truck before year end. An all-new F-150 will debut in 2020 along with a hybrid option.
Much more at the link.  

By the way, we've discussed this before: the importance of Ford getting back into other pickup niches. Not everyone can afford a $75,000 pickup. Nissan has every niche covered.  

By the way, wasn't the tax depreciation benefit accelerated under Trump? I really don't know. I've long forgotten but I seem to recall that the F-150 bought for work could be expensed (for tax purposes) in one year. I could be very, very wrong on that, but I do know that a mom-and-pop roofer working out of their residential home just down the street have as many as five brightly-colored F-150s in front of their house, in their driveway, and in their garage every so often. Must be holding a business meeting.

Folks may want to compare Ford's execution of their business strategy with that of Musk Melon.

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2 comments:

  1. https://moneymaven.io/mishtalk/economics/explaining-the-first-quarter-gdp-3-2-surprise-vipq3rgp2E6m5rnK_IQiWA/

    Apparently they gamed the growth rate with some math.

    I have some major concerns. We’ve had a strong economy for half a decade yet we’re pushing our record deficits. Deficit spending steals wealth from future production. In the US, a dollar of debt produces .40 cents of GDP. A decade of pulling every trick to maintain short-term prosperity is not a sustainable illusion. We desperately need some long-term perspective injected into our policies. It would help too if we dissected indicators beyond: its growing therefore all is good. Of course we want it growing, but 90% of growth can go to 5% of people while the median purchasing power decreases. There are a lot of ways to judge these things.

    ReplyDelete
    Replies
    1. You are correct, a lot of ways to judge these things, and lots to worry about. My reply at this post: https://themilliondollarway.blogspot.com/2019/04/off-net-for-ahile-beautiful-day-going.html.

      By the way, what did "the market" feel about the GDP reported today, headed into a weekend? All three indices closed higher and not trivial gains. The S&P 500 rose almost 14 points. If the S&P 500 didn't close at a new high, it came very, very close. It's intra-day high was 2,939.88 was very, very close to the all-time intra-day high of 2,940.91.

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