Here’s what Wall St. experts are saying about these automakers ahead of earnings

GM expected to report Q1 EPS of $1.71 on revenue $38.95B, Ford expected to report Q1 EPS 40c on revenue of $35.83B

General Motors (GM) is scheduled to report quarterly results before market open on Tuesday, April 25 with a conference call scheduled for 8:30 am EST, while Ford (F) is scheduled to report after market close on Tuesday May 2, with a conference call scheduled for 5:00 pm EST. What to watch for:

GM SALES: In January, General Motors reported the company and its dealers delivered 603,208 vehicles in the U.S., up 16%, in Q1, growing market share by an estimated 1.4 points. "GM delivered a strong start to the year with sales of more than 20,000 EVs as it scales production of vehicles on the Ultium Platform, and expanded truck leadership with launches of new HD and midsize pickup trucks," the company said at the time. The company also reported delivery of over 462,000 vehicles in China in the first quarter.

GM PARTNERSHIPS, INITIATIVES: In January, General Motors announced plans to invest $918M in four U.S. manufacturing sites, including $854M to prepare these facilities to produce the company’s sixth generation Small Block V-8 engine and an additional $64M in Rochester, New York and Defiance, Ohio for castings and components to support EV production. The company and Lithium Americas (LAC) also announced in January they will jointly invest to develop the Thacker Pass mine in Nevada. Under the agreement, GM will make a $650M equity investment in Lithium Americas. GM also partnered with Netflix (NFLX) in February to increase EV presence in Netflix-produced shows and films and entered a long-term direct supply deal for semiconductor chips with GlobalFoundries (GFS). Additionally, the company entered supply agreements with Magna (MGA) and U.S. Steel (X) in February as well as partnered with EVgo (EVGO) to build a charger network along American highways. In March, GM announced a voluntary separation program.

ANALYST VIEW: In April, Barclays analyst Dan Levy lowered the firm’s price target on General Motors to $45 from $46 and kept an Equal Weight rating on the shares. The analyst sees a "low bar" into the Q1 earnings for the U.S. auto and mobility sector. This implies an opportunity for positive share reactions, the analyst said, adding end markets have "held in," but more improvement is required, and company outlooks will likely be maintained.
Additionally in April, Mizuho initiated coverage of General Motors with a Neutral rating and $39 price target. While noting that GM has a broad consumer-commercial EV portfolio, the firm said this is currently only about 2% of the mix and while it sees GM being positioned "well for the next decade of EVs," a transition from a profitable, roughly 98% ICE portfolio to an EV portfolio that currently has a negative 15-30% gross margin "poses significant challenges."

FORD SALES: In February, Ford reported January U.S. sales up 2% versus last year to 146,356 vehicles. In March, Ford reported February U.S. sales were up 21.9% overall to 157,606 vehicles, which includes electric vehicles sales of 3,523, up 68.1%, hybrid vehicles sales of 9,157, up 32.9%, and internal combustion sales of 144,926, up 20.5%. In April, Ford’s reported overall vehicle sales were up 10.1% in Q1 to 475,906 vehicles. Sales surged across trucks, three-row SUVs, Bronco brand, Ford Pro Transit van, Mustang, and EVs, Ford said. Ford’s EV sales grew 41% in Q1 on sales of 10,866 electric vehicles.

FORD PARTNERSHIPS, INITIATIVES: In January, Ford announced an expansion of its complimentary pickup and delivery mobile service nationwide as well as plans to significantly increase Mustang Mach-E production. In February, the company announced it was investing $3.5B to build the country’s first automaker-backed LFP battery plant as well as cutting 3,800 positions in Europe.  Ford also entered a memorandum of understanding to form a battery joint venture with LG Energy and Koc Holding in February. In March, the company established Latitude AI, a wholly owned subsidiary focused on developing a hands-free, eyes-off-the-road automated driving system for millions of vehicles. Ford also announced in March plans to build its next electric truck at BlueOval City.

ANALYST VIEW: In March, Citi analyst Itay Michaeli lowered the firm’s price target on Ford to $12.50 from $14 and kept a Neutral rating on the shares. The company’s recently affirmed guidance suggests a low probability of a downward revision, but Q1 will provide a glimpse into execution following a tough second half of 2022, the analyst said. The firm believes Ford can stay earnings positive in "most hard landings with ample liquidity," but macro risks cause it to trim earnings estimates.

Keywords: earnings watch, earnings, sales, connected vehicle, electric vehicle, EV, partnership, retail sales, truck, SUV, semiconductor