July 24 (Bloomberg) -- Ford Motor Co.’s stock may gain as much as 36 percent after Chief Executive Officer Alan Mulally added U.S. market share and boosted prices without a federal bailout, two analysts said.
The shares may reach $9.50 in six months, Goldman, Sachs & Co.’s Patrick Archambault wrote in a report. Deutsche Bank’s Rod Lache in New York raised his target price to $8 from $5.50. Ford slid 18 cents, or 2.6 percent, to $6.83 at 9:36 a.m. in New York Stock Exchange composite trading as U.S. stocks fell.
“Overall, we were impressed with the execution of Ford’s turnaround plan,” Lache wrote today, maintaining his “hold” rating. Ford’s North American region, its biggest, “appears to be on the right track.”
Mulally cut $10.1 billion from the Dearborn, Michigan-based automaker’s liabilities this year with a debt exchange and seeks union concessions to match those granted to General Motors Co. and Chrysler Group LLC in U.S.-backed bankruptcies. Smaller sales declines at Ford have helped boost U.S. market share.
Ford more than tripled this year through yesterday for the second-biggest advance in the Standard & Poor’s 500 stock index. The shares surged 9.4 percent yesterday after Ford’s second- quarter adjusted loss beat analysts’ estimates.
The results show Ford may be “best positioned to deliver” on auto industry “momentum,” wrote Archambault, who is based in New York and advises buying the shares. Mulally has reduced costs while also raising prices, Archambault wrote.
A rising share price may allow Ford to sell more stock, Joseph Amaturo, a New York-based analyst for Buckingham Research Group, wrote today. He rates the stock as “neutral.” JPMorgan Chase & Co. and Credit Suisse Holdings USA Inc. made similar predictions last week. Ford issued 345 million shares in May, raising $1.6 billion.
Ford’s adjusted loss was 21 cents a share, excluding one- time costs and gains, narrower than the 50-cent average loss estimate among 12 analysts surveyed by Bloomberg. Net income was $2.26 billion, or 69 cents a share, primarily on a $3.4 billion non-cash gain resulting from shrinking debt.
Ford passed Toyota Motor Corp. for second place in U.S. market share through June, behind GM.
NEW YORK -- Shares of Eastman Chemical Co., which makes coatings and specialty plastics, advanced on Friday, after the company reported second-quarter earnings that beat Wall Street expectations.
Shares rose $3, or 6.7 percent, to $48.22 in morning trading
On Thursday the Kingsport, Tenn.-based company said its second-quarter profit fell 43 percent to $65 million, or 89 cents per share, well above the 71-cent estimate by analysts, according to a Thomson Reuters poll.
The company said it expects full-year earnings to be "toward the high end" of its previous guidance of between $2 and $3 per share. Analysts have projected earnings of $2.48 per share.
Deutsche Bank ( DB - news - people ) analyst Jason Minor said the second-quarter results underscored the company's operating strength.
With cost reductions gaining traction, volumes picking up and margins up sharply versus the first quarter, Eastman's second-quarter results highlighted its operating leverage as earnings again improved beyond expectations."
UPDATE 4-Starwood Q2 profit beats Street, shares surge
Adjusted 22 cents EPS vs. 17 cents consensus
* Cuts 2009 full-year outlook
* In discussions to sell non-core assets
* Shares jump over 9 percent (Adds CEO, CFO comment from earnings call, information on supply pipeline, updates shares)
By Deepa Seetharaman
NEW YORK, July 23 (Reuters) - Starwood Hotels & Resorts Inc (HOT.N) posted a better-than-expected profit on Thursday, buoyed by cost cuts, and its shares rose over 9 percent.
Costs and expenses for the second quarter fell by about one-fifth, driven by a more than 30 percent drop in general and administrative costs.
"We continue to beat expectations on cost containment," said Chief Executive Frits van Paasschen during a conference call with analysts.
The majority of those savings are sustainable, with the exception of one-time items and a reduction in bonuses to hotel managers this year, van Paasschen noted.
Shares rose $2.00, or 9.4 percent, to $22.28 in afternoon trading. Rival Marriott International Inc's (MAR.N) stock gained 6 percent, while Host Hotels & Resorts Inc (HST.N), which owns several Starwood properties, saw its stock gain 9 percent.
Starwood reported net income of $134 million, or 74 cents per share, compared with the year-earlier $105 million, or 56 cents per share.
The 28 percent jump in net profit was fueled a gain from a tax incentive program in Italy. Excluding that gain and $26 million in other charges, Starwood earned 22 cents a share.
The results surpassed analyst expectations of 17 cents per share, according to Reuters Estimates.
Revenue fell 23.4 percent to $1.2 billion, slightly lower than analysts' forecast.
But the hotelier, which operates the St. Regis, W and Sheraton chains, also cut its full-year outlook and offered third-quarter estimates that fell far short of analyst expectations.Chief Financial Officer Vasant Prabhu during the call noted that business was stabilizing, but recovery remains slow
The shares may reach $9.50 in six months, Goldman, Sachs & Co.’s Patrick Archambault wrote in a report. Deutsche Bank’s Rod Lache in New York raised his target price to $8 from $5.50. Ford slid 18 cents, or 2.6 percent, to $6.83 at 9:36 a.m. in New York Stock Exchange composite trading as U.S. stocks fell.
“Overall, we were impressed with the execution of Ford’s turnaround plan,” Lache wrote today, maintaining his “hold” rating. Ford’s North American region, its biggest, “appears to be on the right track.”
Mulally cut $10.1 billion from the Dearborn, Michigan-based automaker’s liabilities this year with a debt exchange and seeks union concessions to match those granted to General Motors Co. and Chrysler Group LLC in U.S.-backed bankruptcies. Smaller sales declines at Ford have helped boost U.S. market share.
Ford more than tripled this year through yesterday for the second-biggest advance in the Standard & Poor’s 500 stock index. The shares surged 9.4 percent yesterday after Ford’s second- quarter adjusted loss beat analysts’ estimates.
The results show Ford may be “best positioned to deliver” on auto industry “momentum,” wrote Archambault, who is based in New York and advises buying the shares. Mulally has reduced costs while also raising prices, Archambault wrote.
A rising share price may allow Ford to sell more stock, Joseph Amaturo, a New York-based analyst for Buckingham Research Group, wrote today. He rates the stock as “neutral.” JPMorgan Chase & Co. and Credit Suisse Holdings USA Inc. made similar predictions last week. Ford issued 345 million shares in May, raising $1.6 billion.
Ford’s adjusted loss was 21 cents a share, excluding one- time costs and gains, narrower than the 50-cent average loss estimate among 12 analysts surveyed by Bloomberg. Net income was $2.26 billion, or 69 cents a share, primarily on a $3.4 billion non-cash gain resulting from shrinking debt.
Ford passed Toyota Motor Corp. for second place in U.S. market share through June, behind GM.
NEW YORK -- Shares of Eastman Chemical Co., which makes coatings and specialty plastics, advanced on Friday, after the company reported second-quarter earnings that beat Wall Street expectations.
Shares rose $3, or 6.7 percent, to $48.22 in morning trading
On Thursday the Kingsport, Tenn.-based company said its second-quarter profit fell 43 percent to $65 million, or 89 cents per share, well above the 71-cent estimate by analysts, according to a Thomson Reuters poll.
The company said it expects full-year earnings to be "toward the high end" of its previous guidance of between $2 and $3 per share. Analysts have projected earnings of $2.48 per share.
Deutsche Bank ( DB - news - people ) analyst Jason Minor said the second-quarter results underscored the company's operating strength.
With cost reductions gaining traction, volumes picking up and margins up sharply versus the first quarter, Eastman's second-quarter results highlighted its operating leverage as earnings again improved beyond expectations."
UPDATE 4-Starwood Q2 profit beats Street, shares surge
Adjusted 22 cents EPS vs. 17 cents consensus
* Cuts 2009 full-year outlook
* In discussions to sell non-core assets
* Shares jump over 9 percent (Adds CEO, CFO comment from earnings call, information on supply pipeline, updates shares)
By Deepa Seetharaman
NEW YORK, July 23 (Reuters) - Starwood Hotels & Resorts Inc (HOT.N) posted a better-than-expected profit on Thursday, buoyed by cost cuts, and its shares rose over 9 percent.
Costs and expenses for the second quarter fell by about one-fifth, driven by a more than 30 percent drop in general and administrative costs.
"We continue to beat expectations on cost containment," said Chief Executive Frits van Paasschen during a conference call with analysts.
The majority of those savings are sustainable, with the exception of one-time items and a reduction in bonuses to hotel managers this year, van Paasschen noted.
Shares rose $2.00, or 9.4 percent, to $22.28 in afternoon trading. Rival Marriott International Inc's (MAR.N) stock gained 6 percent, while Host Hotels & Resorts Inc (HST.N), which owns several Starwood properties, saw its stock gain 9 percent.
Starwood reported net income of $134 million, or 74 cents per share, compared with the year-earlier $105 million, or 56 cents per share.
The 28 percent jump in net profit was fueled a gain from a tax incentive program in Italy. Excluding that gain and $26 million in other charges, Starwood earned 22 cents a share.
The results surpassed analyst expectations of 17 cents per share, according to Reuters Estimates.
Revenue fell 23.4 percent to $1.2 billion, slightly lower than analysts' forecast.
But the hotelier, which operates the St. Regis, W and Sheraton chains, also cut its full-year outlook and offered third-quarter estimates that fell far short of analyst expectations.Chief Financial Officer Vasant Prabhu during the call noted that business was stabilizing, but recovery remains slow
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