VinFast Auto Shares Rise After Fed Rate Cut, Ahead of Earnings Report
VinFast Auto Ltd. (VFS) shares climbed on Thursday, October 26th, 2023, following the Federal Reserve's decision to cut interest rates by 50 basis points. The company is also set to report its second-quarter earnings before the market opens on Friday, October 27th, 2023.
The Fed's rate cut, the first in over four years, boosted investor sentiment and led to a broad market rally. The reduced interest rates will lower borrowing costs for businesses and consumers, potentially stimulating economic activity.
Analysts expect VinFast Auto to report a quarterly loss of 21 cents per share and revenue of $460.089 million. The company will host a conference call at 8 a.m. ET on Friday to discuss its earnings results.
In addition to the upcoming earnings report, VinFast Auto is also facing a probe by the National Highway Traffic Safety Administration (NHTSA) into its electric vehicles (EVs). The probe, initiated last week, is based on complaints from vehicle owners regarding issues with the "Lane Keep Assist" system.
Owners have reported that the EVs have difficulty detecting lanes on the road and provide improper steering inputs. The NHTSA investigation covers around 3,118 vehicles manufactured in 2023 and 2024.
Despite the ongoing investigation, Wall Street analysts remain optimistic about VinFast Auto's future. The average 12-month price target for the stock is $8, with six analysts having positive ratings and none having negative ratings.
The company's stock price is currently down 43.83% year-to-date, but the average analyst price target suggests potential for further upside.