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Ford Expects $0.7B Remeasurement Gain in Q4, Recalls 272K Vehicles
FFord Motor(F) ZACKS·2025-01-24 15:21

Ford's Financial Performance - Ford expects a pre-tax remeasurement gain of approximately 0.7billioninQ42024,linkedtopensionandOPEBplansusingmark−to−marketaccounting[1]−Thegainincludesa0.7 billion in Q4 2024, linked to pension and OPEB plans using mark-to-market accounting [1] - The gain includes a 0.3 billion loss from U.S. pension plans, a 0.9billiongainfromnon−U.S.pensionplans,anda0.9 billion gain from non-U.S. pension plans, and a 0.1 billion gain from global OPEB plans [2] - Higher discount rates are the primary driver of the gain, partially offset by lower-than-expected asset returns [2] - After taxes, the remeasurement is estimated to boost net income by about 0.4billion,butitwillnotaffectadjustedEBIToradjustedEPS[3]PensionandOPEBPlans−TheremeasurementhasnoimpactonFord′s2024cashflowor2025pensioncontributionplans[4]−Ford′sfundedplansremainfullyfunded,withunderfundedstatusforpensionandOPEBplansprojectedat0.4 billion, but it will not affect adjusted EBIT or adjusted EPS [3] Pension and OPEB Plans - The remeasurement has no impact on Ford's 2024 cash flow or 2025 pension contribution plans [4] - Ford's funded plans remain fully funded, with underfunded status for pension and OPEB plans projected at 0.5 billion and 4.4billion,respectively,attheendof2024[4]−Thiscomparesto4.4 billion, respectively, at the end of 2024 [4] - This compares to 2.3 billion and $4.7 billion at the end of 2023 [4] Vehicle Recall - Ford is recalling 272,817 vehicles in the U.S. due to potential battery failures, including certain 2021–2023 Bronco Sport and 2022–2023 Maverick models [5] - The 12-volt battery may degrade and fail suddenly, potentially disabling electrical accessories or causing a loss of drive power [5] - Dealers will inspect and replace affected batteries at no cost to owners [5] Industry Comparison - Ford currently carries a Zacks Rank 4 (Sell) [6] - Better-ranked stocks in the auto space include Geely Automobile Holdings Limited (GELYY) and Blue Bird Corporation (BLBD) with Zacks Rank 1 (Strong Buy), and Allison Transmission Holdings, Inc. (ALSN) with Zacks Rank 2 (Buy) [6] Competitor Performance - GELYY's fiscal 2025 sales and earnings are expected to grow 66.62% and 149.31% year-over-year, respectively, with EPS estimates for fiscal 2025 and 2026 improving by 15 cents and 38 cents in the past 30 days [7] - BLBD's fiscal 2025 sales and earnings are expected to grow 10.97% and 12.14% year-over-year, respectively, with EPS estimates for fiscal 2025 improving by 18 cents in the past 60 days [7] - ALSN's 2024 sales and earnings are expected to grow 6.10% and 11.89% year-over-year, respectively, with EPS estimates for 2024 and 2025 improving by 2 cents and 3 cents in the past 30 days [8]