Electric Vehicle Checkpoint: Cramer Lauds Ford CEO Farley

Ford Motor  (F) – Get Report beat Wall Street’s second-quarter earnings expectations and boosted its guidance despite a global semiconductor shortage that has dogged the auto industry. 

The company posted adjusted earnings of 13 cents a share and revenue of $26.8 billion. Automotive revenue came to $24.13 billion.

Jim Cramer broke down how Ford CEO Jim Farley addressed the global chip shortage differently than other automakers, saying: “Jim’s not like most executives. Jim said ‘ok, there’s a chip shortage … I’m going to make 100 calls, be very energized and find where I can get the chips. And, I’m going to cobble together these full-featured chips so I don’t miss nearly as many sales. I feel awful about the $2 billion… I have to cut that and stop selling anywhere that I’m not making money, like China.’ He found the chips… that’s what he did to meet those orders. He worked himself and met with almost everyone in the industry…that’s my kinda guy.” 

‘We are now spring-loaded for growth in the second half and beyond because of red-hot products, pent-up demand, and improving chip supply,’ says Ford CEO Jim Farley.

“The demand for our first round of high-volume EVs clearly has exceeded our most optimistic projections,” he added. “The reservations for the F-150 Lightning have now climbed well past 120,000 units, and 75% of those customers are new to Ford. We are now working around the clock to break constraints and increase our manufacturing capacity for these red-hot, new battery electric vehicles.”

Over on Real Money, contributor Kevin Curran writes that U.S.-based firms staking their growth thesis on China, like Tesla, might be put into a tenuous position worthy of review for retail investors. Get more trading strategies and investing insights from the contributors on Real Money.

With a bullish 2021 outlook, Farley sees a long path ahead in Ford’s transition to an EV world with increased confidence in the company’s EV transition strategy.

Here’s the bottom line: See if Ford can maintain its post-earnings low on the downside and close above the 50-day moving average on the upside, wrote TheStreet’s Bret Kenwell. 

General Motors  (GM) – Get Report closed up 3.23% on Thursday; it’s scheduled to report next week.

The company has filed a lawsuit against rival automaker Ford claiming that the name of Ford’s new automated driving system BlueCruise is an infringement on its Cruise registered trademark.

GM filed its lawsuit in the U.S. District Court for the Northern District of California seeking an injunction enjoining Ford from further use of the name BlueCruise, as well as actual and punitive damages, funds for future advertisements, disgorgement of any wrongfully obtained profits and attorneys fees.

Tesla  (TSLA) – Get Report shares added 4.69% in regular trade Thursday. The company got a muted response to its earnings earlier this week.

Cramer tweeted Monday following the call in which CEO Elon Musk mentioned potential future competitor Apple  (AAPL) – Get Report twice in a negative light and said that he would no longer be attending earnings calls in the future unless he had “something really important” to say.

Shares of luxury electric vehicle start-up Lucid Motors  (LCID) – Get Report rose nearly 10% on Monday following their Nasdaq debut as the race to populate the world’s roads and highways with electric vehicles continues to heat up. The stock’s lost some momentum this week, closing down 3.03% Thursday at $$23.35.

It also comes six months after Lucid announced it was joining forces with Churchill in a bid to take on Tesla and other EV makers like Fisker  (FSR) – Get Report in the U.S. and NIO  (NIO) – Get Report and XPeng  (XPEV) – Get Report in China, though Lucid has its sights set directly on Tesla.

Here is a list of the electric vehicle stocks to watch:

Tesla

Tesla stock isn’t giving us the type of fireworks we have become accustomed to after the electric vehicle company reported earnings. Tesla has been a bit of a roller coaster over the past few months, but not quite the roller coaster that bears were hoping for.

There’s been a lot of drama surrounding the company and the CEO’s take on Bitcoin, but Tesla has continued to deliver solid results. At the beginning of the month, Tesla delivered a record delivery result for the second quarter. Then Tesla delivered a top-and bottom-line beat, logging more than $1 billion in profit as revenue nearly doubled year over year.

TheStreet Quant Ratings rates Tesla as a Hold with a rating score of C.

Ford Motor

Shares of Ford rose after the automaker beat Wall Street’s second-quarter earnings expectations and boosted its guidance despite a global semiconductor shortage that has dogged the auto industry. Ford raised its guidance for full-year adjusted earnings before taxes by about $3.5 billion, to between $9 billion and $10 billion. The company said volume is expected to increase by about 30% sequentially from the first to the second half of the year.

TheStreet Quant Ratings rates Ford as a Hold with a rating score of B-.

Lordstown Motors

Struggling electric truck maker Lordstown Motors  (RIDE) – Get Report said Monday that hedge fund YA II PN Ltd has committed to buying up to $400 million of the company’s stock over a three-year period. Lordstown Motors disclosed the agreement in a filing with the Securities and Exchange Commission. Under the terms of the deal, YA can receive nearly 35 million Lordstown shares upon execution of the agreement, subject to the approval of Lordstown shareholders, as well as a small discount on the shares whenever purchased.

TheStreet Quant Ratings doesn’t have a rating for Lordstown Motors.

General Motors

General Motors shares fell this past week when it said it was recalling the Chevrolet electric Bolt for the second time in a year. The recall is for the I2017-2019 model hatchback and the move came after two vehicles that had been repaired in a prior recall caught fire. GM will replace the vehicles’ battery modules after finding defects in the battery. The recall applies to 68,667 cars with batteries manufactured by South Korea’s LG Chem, according to Bloomberg. Other Bolts, with different batteries, weren’t recalled.

TheStreet Quant Ratings rates GM as a Buy with a rating score of B.

NIO

NIO said that by the end of 2025 it planned to add 3,700 battery-swap stations, which would give it 4,000. A swap station is where EV drivers go to quickly exchange their batteries for new ones, rather than waiting for a charge. A typical electric car takes about eight hours to charge from empty to full, according to U.K. charging company Pod Point. The company is making charging stations a priority, Co-Founder and President Qin Lihong told reporters this past week.

Real Money’s Carolyn Boroden notes bullish technical factors for the company. “I have a simple symmetry setup to consider in NIO,” she wrote. 

TheStreet Quant Ratings rates NIO as a Sell with a rating score of E+.

Li Auto

Li Auto  (LI) – Get Report, the Chinese electric vehicle maker, reported second-quarter deliveries more than doubled and topped its estimates. The Beijing company delivered 17,575 vehicles in the quarter, up 166% year over year and nearly 40% from the first quarter. The company had expected to deliver 14,500 to 15,500 vehicles in the second period.

TheStreet Quant Ratings doesn’t have a rating for Li Auto.

XPeng

Chinese electric vehicle company Xpeng was added to Hang Seng Composite Index this past week. Hang Seng Indexes Company Limited announced that XPeng meets the Fast Entry Rule of various indexes.

TheStreet Quant Ratings has no rating for Xpeng.

Plug Power

RBC analyst Joseph Spak initiated coverage of hydrogen fuel-cell technology company Plug Power  (PLUG) – Get Report with an outperform rating and a one-year price target of $42. Spak wrote that “Plug Power’s valuation is rich, but its long runway for growth justifies the premium.” He also noted that Plug Power has a substantial amount of opportunity for growth, given the Hydrogen Council’s estimates that the hydrogen economy could bring in more than $2.5 trillion in annual sales by 2050 to the immediate industries associated with hydrogen technology.

“They report in August and they must put up good numbers,” said Cramer during a recent episode of Mad Money

TheStreet Quant Ratings rates Plug Power as a Sell with a rating score of D.

Harry Byrne

Harry Byrne

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