Ford Motor Co.’s stock tumbled 10% Friday after weaker-than-expected quarterly earnings and the withdrawal of guidance, adding to the recent selling pressure on its high-yield bonds.
Ford
F,
-9.91%
pulled its guidance after reaching an agreement with the United Auto Workers union following a strike, but the car company also reported an adjusted loss of $1.3 billion for its EV unit, wider than Wall Street was expecting.
The company said customers interested in EVs are “unwilling” to pay the vehicles’ premium prices and it paused billions of long-term investment in EVs due to that disconnect.
See now: Ford pulls guidance as EV unit loses $1.3 billion
Ford is the biggest issuer in the U.S. high-yield, or junk, market with some $72.4 billion of outstanding bonds, as the following chart from data solutions company BondCliQ Media Services shows. The bulk of its dollar-denominated bonds, or $15.9 billion worth, will nature in 2026.
Outstanding Ford Motor debt (USD) by maturity year (Total $72.4 billion). Source: BondCliQ Media Services
The bonds were seeing greater selling on Friday and were 1/4 to 1/2 point lower, according to a market source.
Ford Motor bonds net customer flow (Intraday). Source: BondCliQ Media Services
Over the last 10 days, the bonds were also being sold off, as the following chart shows.
Most active Ford Motor issues with net customer flow (Last 10 days). Source: BondCliQ Media Services
The following chart shows the movement in prices over the same period.
Two week price performance of select Ford Motor bonds. Source: BondCliQ Media Services
“Our business is never short of challenges, especially right now with the evolution of the EV market,” Chief Executive Jim Farley told analysts in a call following results.
Ford earned $1.2 billion, or 30 cents a share, in the third quarter, swinging from a loss of $827 million, or 21 cents a share, in the year-ago period.
Adjusted for one-time items, Ford earned 39 cents a share. Adjustments included a $2.7 billion impairment charge related to the investment in the shuttered, Ford-backed Argo AI driverless-car company.
Revenue rose 11% to $43.8 billion, the carmaker said.
Analysts polled by FactSet expected Ford to report adjusted earnings of 46 cents a share on sales of $43.94 billion.
The stock has fallen 11% in the year to date, while the S&P 500
SPX
has gained 8%.
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