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Auto Stock Roundup: AZO, AAP Miss Quarterly Estimates, Ford Replaces CEO, GM Restructures
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Auto stock prices mostly moved up over the last week. General Motors Company (GM - Free Report) performed well on restructuring initiatives. The company will stop sales in India and sell its South African business to concentrate on its core markets.
AutoZone, Inc. (AZO - Free Report) reported third-quarter fiscal 2017 results. Both earnings and revenues missed the Zacks Consensus Estimate. Advance Auto Parts, Inc. (AAP - Free Report) also reported results for the first quarter of fiscal 2017. Earnings and revenues in the quarter declined year over year and fell short of the Zacks Consensus Estimate.
Ford Motor Company (F - Free Report) announced senior management changes, including the replacement of CEO Mark Fields with Jim Hackett. Meanwhile, Toyota Motor Corp. (TM - Free Report) and three other automakers have agreed to a settlement related to the recalled vehicles affected by the Takata recall.
1. AutoZone reported 6.2% growth in earnings per share to $11.44 for the third quarter of fiscal 2017 from $10.77 recorded in the year-ago quarter. However, earnings missed the Zacks Consensus Estimate of $12.00. Quarterly revenues improved 1.2% year over year to $2.62 billion in the reported quarter. However, the figure missed the Zacks Consensus Estimate of $2.70 billion.
In the third quarter of fiscal 2017, AutoZone repurchased 396,000 shares for $284 million, reflecting an average price of $716 per share. The company had shares worth $1.051 billion remaining for repurchase at the end of the quarter. (Read More: AutoZone Q3 Earnings Miss, Same-Store Sales Down Y/Y)
AutoZone carries a Zacks Rank #3 (Hold).
2. Advance Auto Parts reported a 36% decline in adjusted earnings to $1.60 per share in the first quarter of fiscal 2017 (ended Apr 22, 2017) from $2.51 earned in the prior-year quarter. The figure also missed the Zacks Consensus Estimate of $2.12. Revenues declined 3% year over year to $2.89 billion and lagged the Zacks Consensus Estimate of $2.93 billion.
In the fiscal first quarter, the company’s total store count was 5,059, including 130 Worldpac branches. Advance Auto Parts served roughly 1,250 independently owned Carquest stores as of that date. (Read More: Advance Auto Parts Q1 Earnings Miss Estimates, Down Y/Y)
3. Ford announced that Jim Hackett will be replacing Mark Fields as the company’s CEO. The announcement, which included several other key changes at the top of Ford’s corporate ladder, comes amid concerns about the company’s steadily declining share price. Hackett previously served on Ford’s board of directors and as chairman of the company’s Smart Mobility unit.
Ford also announced its decision to invest $350 million to upgrade its Livonia, MI transmission plant for building fuel-efficient vehicles. This is part of a $2.25 billion investment in the state announced earlier by the company.
Ford carries a Zacks Rank #3.
4. General Motors has decided to stop selling vehicles in India. However, it will continue its manufacturing operations in the region. The company will also be selling its South African operations to Isuzu. It has confirmed plans to lay off 600 workers in the region, per a statement issued by The National Union of Metalworkers of South Africa (NUMSA). This initiative is aimed to help generate cash and focus on more profitable markets.
The company will report charges of $500 million in the second quarter of 2017 for restructuring in India, Singapore and Africa. Of this, $200 million is likely to be a cash charge. The steps are expected to help the company save roughly $100 million a year.
General Motors also carries a Zacks Rank #3.
5. Toyota and three other automakers have agreed to a $553 million settlement covering roughly 16 million recalled vehicles affected by the Takata recall regarding faulty airbags. Toyota has agreed to pay the largest share worth $278.5 million, with BMW AG, Mazda Motor Corp. and Subaru Corp. paying $131 million, $76 million and $68 million, respectively.
Auto stocks recorded a mostly positive performance in the last week. General Motors was the highest gainer among the stocks listed below, while AutoZone saw the largest decline.
In the last six months, Tesla, Inc. (TSLA - Free Report) was the sole gainer, while AutoZone was the worst performer.
The U.S. auto sales for May will release in the coming week.
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Auto Stock Roundup: AZO, AAP Miss Quarterly Estimates, Ford Replaces CEO, GM Restructures
Auto stock prices mostly moved up over the last week. General Motors Company (GM - Free Report) performed well on restructuring initiatives. The company will stop sales in India and sell its South African business to concentrate on its core markets.
AutoZone, Inc. (AZO - Free Report) reported third-quarter fiscal 2017 results. Both earnings and revenues missed the Zacks Consensus Estimate. Advance Auto Parts, Inc. (AAP - Free Report) also reported results for the first quarter of fiscal 2017. Earnings and revenues in the quarter declined year over year and fell short of the Zacks Consensus Estimate.
Ford Motor Company (F - Free Report) announced senior management changes, including the replacement of CEO Mark Fields with Jim Hackett. Meanwhile, Toyota Motor Corp. (TM - Free Report) and three other automakers have agreed to a settlement related to the recalled vehicles affected by the Takata recall.
(Read the previous roundup here: Auto Stock Roundup for May 18, 2017)
Recap of the Week’s Most Important Stories
1. AutoZone reported 6.2% growth in earnings per share to $11.44 for the third quarter of fiscal 2017 from $10.77 recorded in the year-ago quarter. However, earnings missed the Zacks Consensus Estimate of $12.00. Quarterly revenues improved 1.2% year over year to $2.62 billion in the reported quarter. However, the figure missed the Zacks Consensus Estimate of $2.70 billion.
In the third quarter of fiscal 2017, AutoZone repurchased 396,000 shares for $284 million, reflecting an average price of $716 per share. The company had shares worth $1.051 billion remaining for repurchase at the end of the quarter. (Read More: AutoZone Q3 Earnings Miss, Same-Store Sales Down Y/Y)
AutoZone carries a Zacks Rank #3 (Hold).
2. Advance Auto Parts reported a 36% decline in adjusted earnings to $1.60 per share in the first quarter of fiscal 2017 (ended Apr 22, 2017) from $2.51 earned in the prior-year quarter. The figure also missed the Zacks Consensus Estimate of $2.12. Revenues declined 3% year over year to $2.89 billion and lagged the Zacks Consensus Estimate of $2.93 billion.
In the fiscal first quarter, the company’s total store count was 5,059, including 130 Worldpac branches. Advance Auto Parts served roughly 1,250 independently owned Carquest stores as of that date. (Read More: Advance Auto Parts Q1 Earnings Miss Estimates, Down Y/Y)
Advance Auto Parts carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
3. Ford announced that Jim Hackett will be replacing Mark Fields as the company’s CEO. The announcement, which included several other key changes at the top of Ford’s corporate ladder, comes amid concerns about the company’s steadily declining share price. Hackett previously served on Ford’s board of directors and as chairman of the company’s Smart Mobility unit.
Ford also announced its decision to invest $350 million to upgrade its Livonia, MI transmission plant for building fuel-efficient vehicles. This is part of a $2.25 billion investment in the state announced earlier by the company.
Ford carries a Zacks Rank #3.
4. General Motors has decided to stop selling vehicles in India. However, it will continue its manufacturing operations in the region. The company will also be selling its South African operations to Isuzu. It has confirmed plans to lay off 600 workers in the region, per a statement issued by The National Union of Metalworkers of South Africa (NUMSA). This initiative is aimed to help generate cash and focus on more profitable markets.
The company will report charges of $500 million in the second quarter of 2017 for restructuring in India, Singapore and Africa. Of this, $200 million is likely to be a cash charge. The steps are expected to help the company save roughly $100 million a year.
General Motors also carries a Zacks Rank #3.
5. Toyota and three other automakers have agreed to a $553 million settlement covering roughly 16 million recalled vehicles affected by the Takata recall regarding faulty airbags. Toyota has agreed to pay the largest share worth $278.5 million, with BMW AG, Mazda Motor Corp. and Subaru Corp. paying $131 million, $76 million and $68 million, respectively.
The automakers claimed that they have agreed to the settlement due to the size of the recall but did not admit any fault. (Read More: Toyota & Other Manufacturers Agree to Takata Settlement)
Toyota carries a Zacks Rank #4.
Performance
Auto stocks recorded a mostly positive performance in the last week. General Motors was the highest gainer among the stocks listed below, while AutoZone saw the largest decline.
In the last six months, Tesla, Inc. (TSLA - Free Report) was the sole gainer, while AutoZone was the worst performer.
Company
Last 1-Week Period
Last 6 Months
GM
+2.4%
-3.1%
F
+1.9%
-9.0%
TSLA
+1.3%
+57.8%
TM
+1.45%
-8.9%
HMC
+1.8%
-4.9%
HOG
-1.9%
-13.6%
AAP
-8.0%
-22.2%
AZO
-11.0%
-25.9%
Auto-Tires-Trucks Sector 5YR % Return
Auto-Tires-Trucks Sector 5YR % Return
What’s Next in the Auto Space?
The U.S. auto sales for May will release in the coming week.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look. See the pot trades we're targeting>>