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Auto Stock Roundup: Winnebago Beats on Earnings; GM, Ford to Trim Production Level
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The auto sector had a mixed week in terms of developments, although the performance of stocks was mostly positive. Winnebago Industries, Inc. (WGO - Free Report) surpassed earnings and revenue estimates for the first quarter of fiscal 2017, while Toyota Motor Corporation (TM - Free Report) projected 1% global sales growth for 2017.
Meanwhile, General Motors Company (GM - Free Report) announced new investments as well as plans to temporarily stop production in a few U.S. plants. Even Ford Motor Co. (F - Free Report) revealed plans to pause production in Venezuela.
Additionally, Honda Motor Co., Ltd. (HMC - Free Report) announced that it is in discussion with Waymo for a self-driving collaboration.
Recap of the Week’s Most Important Stories
1. Winnebago reported adjusted earnings of 60 cents per share in the first quarter of fiscal 2017 (ended Nov 26, 2016), higher than 32 cents earned in the prior-year quarter. Also, the figure surpassed the Zacks Consensus Estimate of 35 cents. Revenues for the first quarter increased 14.5% to $245.3 million and surpassed the Zacks Consensus Estimate of $221 million. The year-over-year increase in top line was due to strong growth in the towables business.
Winnebago currently carries a Zacks Rank #3 (Hold).
2. Toyota expects global sales to increase by 1% to 10.2 million vehicles in 2017 over its projection for 2016, triggered by higher sales in North America, China, Europe and Asia. Launch of new models, including the C-HR compact sport utility vehicle, will drive sales for the automaker. These benefits will offset sluggish demand in the Middle East due to low oil prices (read more: Toyota Projects Global Sales Increase of 1% for 2017).
Currently, Toyota has a Zacks Rank #3.
3. General Motors announced plans to invest around $552 million in the U.S. mainly for upgrading manufacturing facilities in Tonawanda, Lockport and Rochester located in New York and Parma Metal center in Ohio. The automaker plans to spend around $2.2 billion in its U.S operations in 2016 in order to support the production of upgraded engines and vehicles. The new investment is part of this investment plan.
Meanwhile, the auto giant confirmed that it will be closing five U.S. assembly plants for one to three weeks next month, mostly to trim the oversupply of sedans and other passenger cars as consumer preference for trucks and SUVs is growing. According to the Detroit Free Press, GM’s Detroit-Hamtramck and Fairfax plants will be closed for three weeks; its Lansing factory that builds that Cadillac CTS and ATS will be shut down for two weeks; and GM’s plants in Lordstown, OH and Bowling Green, KY, which build the Chevy Cruze and Corvette, respectively, will not be operational for one week.
4. Honda’s R&D subsidiary, Honda R&D Co., Ltd. is in discussions with Alphabet Inc.’s unit Waymo for a collaboration related to the self-driving technology. Per the discussions, Honda will provide modified vehicles, which will be integrated with Waymo’s self-driving technology and become part of the latter’s test fleet.
Honda currently carries a Zacks Rank #3.
5. Ford halted production in Venezuela last week and said that it will not restart it before next April. This decision has been taken in the wake of sluggish demand for new cars in South America. The shutdown will affect around 2,000 workers. This temporary halt in production is not likely to affect Ford’s results as the company reports its Venezuela operations separately (read more: Ford Halts Production in Venezuela till April on Weak Demand).
Ford carries a Zacks Rank #3.
Performance
The strong performance of the overall equity market pulled up all auto stocks over the last week. Only Harley-Davidson, Inc. (HOG - Free Report) lost marginally among the stocks listed below. Meanwhile, Tesla Motors, Inc. (TSLA - Free Report) led with a 4.5% gain.
Over the last six months, Harley-Davidson gained the most, while Ford suffered the maximum loss among the stocks listed below.
On Dec 30, 2016, Harley-Davidson will pay a quarterly dividend of 35 cents per share to shareholders of record as of Dec 16. On the same day, Lear Corp. will pay a quarterly dividend of 30 cents per share to shareholders of record as of Dec 9.
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Auto Stock Roundup: Winnebago Beats on Earnings; GM, Ford to Trim Production Level
The auto sector had a mixed week in terms of developments, although the performance of stocks was mostly positive. Winnebago Industries, Inc. (WGO - Free Report) surpassed earnings and revenue estimates for the first quarter of fiscal 2017, while Toyota Motor Corporation (TM - Free Report) projected 1% global sales growth for 2017.
Meanwhile, General Motors Company (GM - Free Report) announced new investments as well as plans to temporarily stop production in a few U.S. plants. Even Ford Motor Co. (F - Free Report) revealed plans to pause production in Venezuela.
Additionally, Honda Motor Co., Ltd. (HMC - Free Report) announced that it is in discussion with Waymo for a self-driving collaboration.
Recap of the Week’s Most Important Stories
1. Winnebago reported adjusted earnings of 60 cents per share in the first quarter of fiscal 2017 (ended Nov 26, 2016), higher than 32 cents earned in the prior-year quarter. Also, the figure surpassed the Zacks Consensus Estimate of 35 cents. Revenues for the first quarter increased 14.5% to $245.3 million and surpassed the Zacks Consensus Estimate of $221 million. The year-over-year increase in top line was due to strong growth in the towables business.
Winnebago currently carries a Zacks Rank #3 (Hold).
2. Toyota expects global sales to increase by 1% to 10.2 million vehicles in 2017 over its projection for 2016, triggered by higher sales in North America, China, Europe and Asia. Launch of new models, including the C-HR compact sport utility vehicle, will drive sales for the automaker. These benefits will offset sluggish demand in the Middle East due to low oil prices (read more: Toyota Projects Global Sales Increase of 1% for 2017).
Currently, Toyota has a Zacks Rank #3.
3. General Motors announced plans to invest around $552 million in the U.S. mainly for upgrading manufacturing facilities in Tonawanda, Lockport and Rochester located in New York and Parma Metal center in Ohio. The automaker plans to spend around $2.2 billion in its U.S operations in 2016 in order to support the production of upgraded engines and vehicles. The new investment is part of this investment plan.
Meanwhile, the auto giant confirmed that it will be closing five U.S. assembly plants for one to three weeks next month, mostly to trim the oversupply of sedans and other passenger cars as consumer preference for trucks and SUVs is growing. According to the Detroit Free Press, GM’s Detroit-Hamtramck and Fairfax plants will be closed for three weeks; its Lansing factory that builds that Cadillac CTS and ATS will be shut down for two weeks; and GM’s plants in Lordstown, OH and Bowling Green, KY, which build the Chevy Cruze and Corvette, respectively, will not be operational for one week.
General Motors currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
4. Honda’s R&D subsidiary, Honda R&D Co., Ltd. is in discussions with Alphabet Inc.’s unit Waymo for a collaboration related to the self-driving technology. Per the discussions, Honda will provide modified vehicles, which will be integrated with Waymo’s self-driving technology and become part of the latter’s test fleet.
Honda currently carries a Zacks Rank #3.
5. Ford halted production in Venezuela last week and said that it will not restart it before next April. This decision has been taken in the wake of sluggish demand for new cars in South America. The shutdown will affect around 2,000 workers. This temporary halt in production is not likely to affect Ford’s results as the company reports its Venezuela operations separately (read more: Ford Halts Production in Venezuela till April on Weak Demand).
Ford carries a Zacks Rank #3.
Performance
The strong performance of the overall equity market pulled up all auto stocks over the last week. Only Harley-Davidson, Inc. (HOG - Free Report) lost marginally among the stocks listed below. Meanwhile, Tesla Motors, Inc. (TSLA - Free Report) led with a 4.5% gain.
Over the last six months, Harley-Davidson gained the most, while Ford suffered the maximum loss among the stocks listed below.
Company
Last 1-Week Period
Last 6 Months
GM
+1.3%
+24.2%
F
+0.9%
-4.1%
TSLA
+4.5%
+5.6%
TM
0.0%
+13.7%
HMC
0.0%
+15.8%
HOG
-0.5%
+29.4%
AAP
+1.2%
+13.3%
AZO
+1.9%
+6.3%
Auto-Tires-Trucks Sector 5YR % Return
Auto-Tires-Trucks Sector 5YR % Return
What’s Next in the Auto Space?
On Dec 30, 2016, Harley-Davidson will pay a quarterly dividend of 35 cents per share to shareholders of record as of Dec 16. On the same day, Lear Corp. will pay a quarterly dividend of 30 cents per share to shareholders of record as of Dec 9.
Zacks' Best Investment Ideas for Long-Term Profit
Today you can gain access to long-term trades with double and triple-digit profit potential rarely available to the public. Starting now, you can look inside our stocks under $10, home run and value stock portfolios, plus more. Want a peek at this private information? Click here >>