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Auto Stock Roundup: Toyota Provides Weak FY18 View, Tesla Launches Solar Roof
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The last week witnessed mixed stock performance in the auto sector. Movement could be partly attributable to the earnings that released in the previous week. This week, Toyota Motor Corp Ltd (TM - Free Report) reported fourth-quarter and fiscal 2017 results, beating expectations. However, the company provided a weak outlook for fiscal 2018.
Sales in China improved for Ford Motor Company (F - Free Report) in April but General Motors Company (GM - Free Report) saw a decline. Meanwhile, Tesla Inc. (TSLA - Free Report) began taking orders for its new Solar Roof.
Harley-Davidson, Inc. (HOG - Free Report) partnered with a motorcycle rental agency to raise the number of riders in the U.S. while O'Reilly Automotive, Inc. (ORLY - Free Report) increased its share repurchase program.
1. Toyota recorded earnings of $2.32 per ADR in fourth-quarter fiscal 2017 (ended Mar 31, 2017). Earnings surpassed the Zacks Consensus Estimate of $1.90. Consolidated revenues came in at $65.5 billion in the reported quarter, which also surpassed the Zacks Consensus Estimate of $62.32 billion.
Toyota expects consolidated vehicle sales for fiscal 2018 to be 8.90 million units, compared to the 8.97 million units recorded in fiscal 2017. Consolidated revenue is expected to be ¥27.5 trillion ($261.9 billion), reflecting a 0.4% decline over fiscal 2017. The company also expects profits to decline year over year in fiscal 2018.
Toyota carries a Zacks Rank #4 (Sell).
2. General Motors and its joint ventures in China reported a 1.9% year-over-year decrease in sales for Apr 2017, at 272,770 vehicles. The company unveiled its first SUV under the Wuling brand — Hong Guang S3, in April.
General Motors carries a Zacks Rank #3 (Hold).
Meanwhile, Ford and its joint ventures reported an 11% year-over-year rise in China sales to 93,967 units in Apr 2017, driven by strong demand for Lincoln and Ford sedans. The company now expects China sales volume to be 28.2 million in 2017.
3. Harley-Davidson has partnered with motorcycle rental and tour company, EagleRider, to achieve its goal of increasing the number of riders in the U.S. Through the partnership, motorcyclists can rent and tour on the latest Harley-Davidson motorcycles at EagleRider locations. EagleRider serves over 100,000 riders annually through motorcycle rental and touring in the U.S. across 27 states.
Harley-Davidson also carries a Zacks Rank #3.
4. Tesla began taking orders for its new product, Solar Roof, to power homes. Solar Roof is designed to look like traditional roofing shingles. These can be ordered on a $1000 down payment and will cost roughly $21.85 per square foot. While solar tiles are relatively expensive, they will be combined with non-solar tiles to complete the roof. Eventually the roof is expected to save enough electricity to pay for itself. Installations are expected to start next month in the U.S. — starting with California, and outside the U.S next year. The company expects the initial demand to be relatively slow.
Tesla carries a Zacks Rank #4 (Sell).
5. O’Reilly increased its authorized share repurchase program by $1 billion, taking the total authorization under the program to $8.75 billion. The additional $1 billion authorization is effective for a three-year period, beginning on May 10, 2017. Stocks will be repurchased from time to time under the program through open market purchases.
O’Reilly carries a Zacks Rank #3.
Performance
Auto stocks recorded a mixed performance over the last week. Toyota lost the most among the stocks listed below, while Tesla was the highest gainer.
In the last six months, Tesla was the biggest gainer, while Ford was the worst performer.
The details of Ford’s annual general meeting are expected.
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Auto Stock Roundup: Toyota Provides Weak FY18 View, Tesla Launches Solar Roof
The last week witnessed mixed stock performance in the auto sector. Movement could be partly attributable to the earnings that released in the previous week. This week, Toyota Motor Corp Ltd (TM - Free Report) reported fourth-quarter and fiscal 2017 results, beating expectations. However, the company provided a weak outlook for fiscal 2018.
Sales in China improved for Ford Motor Company (F - Free Report) in April but General Motors Company (GM - Free Report) saw a decline. Meanwhile, Tesla Inc. (TSLA - Free Report) began taking orders for its new Solar Roof.
Harley-Davidson, Inc. (HOG - Free Report) partnered with a motorcycle rental agency to raise the number of riders in the U.S. while O'Reilly Automotive, Inc. (ORLY - Free Report) increased its share repurchase program.
(Read the previous roundup here: Auto Stock Roundup for May 4, 2017)
Recap of the Week’s Most Important Stories
1. Toyota recorded earnings of $2.32 per ADR in fourth-quarter fiscal 2017 (ended Mar 31, 2017). Earnings surpassed the Zacks Consensus Estimate of $1.90. Consolidated revenues came in at $65.5 billion in the reported quarter, which also surpassed the Zacks Consensus Estimate of $62.32 billion.
Toyota expects consolidated vehicle sales for fiscal 2018 to be 8.90 million units, compared to the 8.97 million units recorded in fiscal 2017. Consolidated revenue is expected to be ¥27.5 trillion ($261.9 billion), reflecting a 0.4% decline over fiscal 2017. The company also expects profits to decline year over year in fiscal 2018.
Toyota carries a Zacks Rank #4 (Sell).
2. General Motors and its joint ventures in China reported a 1.9% year-over-year decrease in sales for Apr 2017, at 272,770 vehicles. The company unveiled its first SUV under the Wuling brand — Hong Guang S3, in April.
General Motors carries a Zacks Rank #3 (Hold).
Meanwhile, Ford and its joint ventures reported an 11% year-over-year rise in China sales to 93,967 units in Apr 2017, driven by strong demand for Lincoln and Ford sedans. The company now expects China sales volume to be 28.2 million in 2017.
Ford also carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
3. Harley-Davidson has partnered with motorcycle rental and tour company, EagleRider, to achieve its goal of increasing the number of riders in the U.S. Through the partnership, motorcyclists can rent and tour on the latest Harley-Davidson motorcycles at EagleRider locations. EagleRider serves over 100,000 riders annually through motorcycle rental and touring in the U.S. across 27 states.
Harley-Davidson also carries a Zacks Rank #3.
4. Tesla began taking orders for its new product, Solar Roof, to power homes. Solar Roof is designed to look like traditional roofing shingles. These can be ordered on a $1000 down payment and will cost roughly $21.85 per square foot. While solar tiles are relatively expensive, they will be combined with non-solar tiles to complete the roof. Eventually the roof is expected to save enough electricity to pay for itself. Installations are expected to start next month in the U.S. — starting with California, and outside the U.S next year. The company expects the initial demand to be relatively slow.
Tesla carries a Zacks Rank #4 (Sell).
5. O’Reilly increased its authorized share repurchase program by $1 billion, taking the total authorization under the program to $8.75 billion. The additional $1 billion authorization is effective for a three-year period, beginning on May 10, 2017. Stocks will be repurchased from time to time under the program through open market purchases.
O’Reilly carries a Zacks Rank #3.
Performance
Auto stocks recorded a mixed performance over the last week. Toyota lost the most among the stocks listed below, while Tesla was the highest gainer.
In the last six months, Tesla was the biggest gainer, while Ford was the worst performer.
Company
Last 1-Week Period
Last 6 Months
GM
+2.2%
+4.6%
F
-0.3%
-7.5%
TSLA
+4.6%
+75.5%
TM
-2.8%
-4.6%
HMC
-1.5%
+0.5%
HOG
+2.1%
-4.5%
AAP
+2.3%
+0.2%
AZO
+0.1%
-6.5%
Auto-Tires-Trucks Sector 5YR % Return
Auto-Tires-Trucks Sector 5YR % Return
What’s Next in the Auto Space?
The details of Ford’s annual general meeting are expected.
Looking for Ideas with Even Greater Upside?
Most of Zacks’ investment ideas are short-term, directly based on our proven 1 to 3 month indicator. In addition, I invite you to consider our long-term opportunities. These rare trades look to start fast with strong Zacks Ranks, but carry through with double and triple-digit profit potential. Starting now, you can look inside our home run, value, and stocks under $10 portfolios, plus more. Click here for a peek at this private information>>