DETROIT (AP) — A Standard & Poor's auto analyst cut his profit projections on Ford Motor Co. Tuesday because of problems in international markets, especially Europe.
THE SPARK: Standard & Poor's auto analyst Efraim Levy cut his second-quarter earnings estimate on the Dearborn, Mich., automaker by 7 cents to 34 cents per share, and he cut the full-year estimate by 12 cents to $1.34. He cut his estimate for 2013 profit by 6 cents to $1.65 per share.
He also cut his 12-month price target on shares by $1 to $13.
THE BIG PICTURE: Ford earnings in North America have been strong. But the weakening global economy has hurt results, leading Ford to warn that its second-quarter profit would be less than the $2.4 billion it made in the same quarter last year. Ford lost market share in Europe in June, Levy wrote.
The company is also making a huge investment in plants and products to increase sales in China. While that's hurting results for this year, the investment will ultimately benefit Ford by propelling auto volumes and profit in the world's No. 2 economy, Levy said.
SHARE ACTION: Ford shares fell 3 cents to $9.24 in midday trading. They have traded in a range of $9.05 to $13.44 in the past year, but the stock has fallen about 22 percent in the past three months as conditions in Europe deteriorated.
