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Standard Motor (SMP) Q2 Earnings Miss Estimates, Down Y/Y

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Share price of Standard Motor Products Inc. (SMP - Free Report) declined 4.6% to $50.38 on Jul 31, as the company missed earnings estimate.

Second-quarter 2017 adjusted earnings of 81 cents per share missed the Zacks Consensus Estimate of 99 cents. Also, it came lower than the prior-year quarter figure of 88 cents per share.

Earnings from continuing operations, on a reported basis, amounted to $18.3 million or 78 cents per share, declining from $19.9 million or 86 cents in the prior-year quarter.

Total revenue also increased to $312.7 million from $289 million a year ago, surpassing the Zacks Consensus Estimate of $311 million.

Gross profit in the second quarter of 2017 increased to $90.7 million from $87.1 million in the year-ago quarter. Operating income declined to $29.7 million from $31.8 million in the year-ago quarter.

Segment Results

Revenues at the Engine Management segment increased to $223.3 million in the reported quarter from $198.8 million a year ago. Operating profit was $27.4 million (12.3% of sales) compared with $30.6 million (15.4% of sales) in the prior-year quarter.

Revenues at the Temperature Control segment slightly decreased to $87.4 million from $87.5 million a year ago. The segment recorded an operating profit of $8.6 million (9.8% of sales) compared with a profit of $6.3 million (7.2% of sales) in the second quarter of 2016.

Revenues at the All Other segment decreased to $1.99 million from $2.63 million a year ago. The segment registered an operating loss of $5.4 million, wider than $4.6 million in the second quarter of 2016.

Financial Position

Standard Motor had cash and cash equivalent of $16.4 million as of Jun 30, 2017 compared with $12.4 million as of Jun 30, 2016. Long-term debt of the company was $101,000 as of Jun 30, 2017, compared with $120,000 as of Dec 31, 2016.

Business Update

Along with the integration of the General Cable North American ignition wire acquisition, the company has begun transferring the entire production from the acquired plant in Nogales, Mexico to Reynosa, Mexico.

Also, the company started to move its electronics plant in Orlando, Florida, to Independence, Kansas.

Dividend

Standard Motor’s board approved a dividend of 19 cents per share to be paid on Sep 1 to stockholders of record on Aug 15.

Zacks Rank & Key Picks

Currently, Standard Motor has a Zacks Rank #3 (Hold).

Some better-ranked companies in the auto space are Allison Transmission Holdings (ALSN - Free Report) , Volkswagen AG and Daimler AG , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Allison Transmission has expected long-term growth rate of 11%.

Volkswagen has expected growth rate of around 17.3% in the long run.

Daimler has expected long-term growth rate of 2.8%.

Standard Motor Products, Inc. Price, Consensus and EPS Surprise

Standard Motor Products, Inc. Price, Consensus and EPS Surprise | Standard Motor Products, Inc. Quote

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