We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The past week saw heightened activities from auto companies such as General Motors Company (GM - Free Report) and Magna International Inc. in the self-driving vehicles front. While General Motors promised investment for upgrading self-driving vehicles manufacturing, Magna announced a partnership with the ride sharing company Lyft, to finance, build and manufacture self-driving systems.
However, this week self-driving activities suffered a setback as a test vehicle from leading ridesharing company, Uber Technologies Inc. struck and killed a 49-year-old woman in Tempe, AZ. Safety issues apart, this sad incident gave a jolt to the self-driving car industry, which is witnessing billions of dollars of investment and has the potential to be a game changer in the transportation space.
On the positive side, the week also saw some relaxation in the imposition of tariffs for Canada and Mexico, keeping in mind the North American Free Trade Agreement (NAFTA) negotiations. President Trump dropped the initial proposal that vehicles manufactured in Canada and Mexico and intended for the U.S. market should contain at least 50% American materials. This has somewhat relieved the auto industry.
1. Superior Industries International Inc.’s (SUP - Free Report) adjusted earnings of 38 cents per share for fourth-quarter 2017 topped the Zacks Consensus Estimate of 24 cents. Including after-tax expense and the impact of U.S. tax reform, net loss for the quarter was $4.6 million or 50 cents per share.
Revenues were $361.8 million in the reported quarter, missing the Zacks Consensus Estimate of $363.8 million. However, the reported figure was higher than $188.3 million recorded in the year-ago quarter.
Wheel unit shipments were 5.4 million compared with 3.1 million in the prior-year quarter. The rise was primarily due to the addition of its European operations, partly offset by a decline in the North American market from the prior-year quarter. Value-added sales, i.e., net sales minus pass-through charges for aluminum, increased to $203.5 million compared with $106.4 million in fourth-quarter 2016.
Gross profit rose to $39.7 million from $18 million in the year-ago quarter. The increase was due to the addition of European operations, partly offset by non-recurring effects of purchase accounting adjustments of $1.3 million related to the buyout of UNIWHEELS and ongoing amortization of intangibles related to the acquisition. (Read more: Superior Industries Q4 Earnings Surpass Estimates)
2. General Motors reported that it will invest more than $100 million for the development of its two assembly plants located in Michigan namely, Orion Township and Brownstown. This investment will be done to upgrade the plants for manufacturing self-driving vehicle, Cruise AV. The model is a rebranded version of General Motors’ Chevrolet Bolt EV.
Starting in 2019, the Cruise AV model will be produced at its Orion Township plant, while the roof modules will be assembled at its Brownstown battery assembly facility. Per management, the team members of these two plants are well prepared to manufacture Cruise AV as they already have experience in producing high-quality battery packs and autonomous test vehicles.
3. Magna International Inc. and Lyft, a growing rideshare company, announced a multi-year partnership. The partnership intends to finance, build up and manufacture self-driving systems. Apart from this, Magna, a mobility company, has plans to invest $200 million in Lyft equity. However, the partnership is subject to certain regulatory approvals.
This partnership will enable Magna and Lyft to develop and manufacture self-driving systems effectively. In fact, Lyft’s expertise in ridesharing services and the automotive experience of Magna have the capability to make this collaboration a success.
Lyft will be the frontrunner in the co-development of the self-driving system at the Palo, Alto-based self-driving center. Magna is likely to lead the manufacturing of the car and join Lyft’s development team. In effect, Magna will lend its vehicle systems knowledge, manufacturing capabilities and safety and ADAS expertise. (Read more: Magna & Lyft Tie Up to Develop Self-Driving Systems)
Magna carries a Zacks Rank #3.
4. Volkswagen AG is planning to invest $340 million (£242 million) to upgrade its Chattanooga, TN facility. The amount will be used to manufacture a new sports utility vehicle (SUV), per Reuters. This decision was taken by the company after a surge in demand for large vehicles was observed.
The new five-passenger SUV will be added to the company’s Atlas family. In 2017, Volkswagen started selling its seven-passenger Atlas model and launched its all-new 2018 Tiguan SUV. A concept version of the new SUV will be launched next week at the New York International Auto Show.
In 2011, Volkswagen’s Chattanooga assembly plant started the production of Passat, a mid-sized sedan. Currently, a flourishing U.S. manufacturing plant produces three different vehicle models. (Read more: Volkswagen Plans to Invest $340M for SUV Production in US)
Volkswagen carries a Zacks Rank #2.
5. AutoZone, Inc.’s (AZO - Free Report) board of directors authorized a share buyback program worth $1 billion. This authorization is in addition to its current share repurchase program. Including this, the company’s board has approved $19.7 billion for buying back shares since 1998.
In second-quarter fiscal 2018, AutoZone reported earnings per share of $10.38, beating the Zacks Consensus Estimate of $8.81. Quarterly revenues rose 5.4% year over year to $2.41 billion. The top line also surpassed the Zacks Consensus Estimate. This continued strong financial performance and fine credit rating are permitting the company to repurchase stocks with an aim to boost shareholders’ confidence while maintaining enough liquidity at the same time.
Earlier this month, the company had increased its share repurchase authorization by $750 million. Prior to this, share buyback of the same amount was approved in March and September 2016. (Read more: AutoZone Announces $1B Share Repurchase Authorization)
AutoZone carries a Zacks Rank #3.
Performance
Last week, all these stocks, except Ford Motor Company (F - Free Report) recorded a decline. The sharpest decline was witnessed by Tesla, Inc. (TSLA - Free Report) .
In the last six months, the maximum rise was recorded by Advance Auto Parts, Inc. (AAP - Free Report) while Harley-Davidson, Inc. (HOG - Free Report) shares declined the most.
Company
Last Week
Last 6 Months
GM
-0.3%
-6.8%
F
0.7%
-7%
TSLA
-3.1%
-8.3%
TM
-0.6%
6.9%
HMC
-0.3%
15.3%
HOG
-0.4%
-11.6%
AAP
-1.6%
17.6%
AZO
-0.2%
11.1%
What’s Next in the Auto Space?
Watch out for the earnings releases and other developments in the sector in the coming days.
Zacks Editor-in-Chief Goes "All In" on This Stock
Full disclosure, Kevin Matras now has more of his own money in one particular stock than in any other. He believes in its short-term profit potential and also in its prospects to more than double by 2019. Today he reveals and explains his surprising move in a new Special Report.
Image: Bigstock
Auto Stock Roundup: Uber Crash Hits Self-Driving, SUP Tops, AZO Boosts Buyback
The past week saw heightened activities from auto companies such as General Motors Company (GM - Free Report) and Magna International Inc. in the self-driving vehicles front. While General Motors promised investment for upgrading self-driving vehicles manufacturing, Magna announced a partnership with the ride sharing company Lyft, to finance, build and manufacture self-driving systems.
However, this week self-driving activities suffered a setback as a test vehicle from leading ridesharing company, Uber Technologies Inc. struck and killed a 49-year-old woman in Tempe, AZ. Safety issues apart, this sad incident gave a jolt to the self-driving car industry, which is witnessing billions of dollars of investment and has the potential to be a game changer in the transportation space.
On the positive side, the week also saw some relaxation in the imposition of tariffs for Canada and Mexico, keeping in mind the North American Free Trade Agreement (NAFTA) negotiations. President Trump dropped the initial proposal that vehicles manufactured in Canada and Mexico and intended for the U.S. market should contain at least 50% American materials. This has somewhat relieved the auto industry.
(Read the previous roundup here: Auto Stock Roundup for Mar 15, 2018)
Recap of the Week’s Most Important Stories
1. Superior Industries International Inc.’s (SUP - Free Report) adjusted earnings of 38 cents per share for fourth-quarter 2017 topped the Zacks Consensus Estimate of 24 cents. Including after-tax expense and the impact of U.S. tax reform, net loss for the quarter was $4.6 million or 50 cents per share.
Revenues were $361.8 million in the reported quarter, missing the Zacks Consensus Estimate of $363.8 million. However, the reported figure was higher than $188.3 million recorded in the year-ago quarter.
Wheel unit shipments were 5.4 million compared with 3.1 million in the prior-year quarter. The rise was primarily due to the addition of its European operations, partly offset by a decline in the North American market from the prior-year quarter. Value-added sales, i.e., net sales minus pass-through charges for aluminum, increased to $203.5 million compared with $106.4 million in fourth-quarter 2016.
Gross profit rose to $39.7 million from $18 million in the year-ago quarter. The increase was due to the addition of European operations, partly offset by non-recurring effects of purchase accounting adjustments of $1.3 million related to the buyout of UNIWHEELS and ongoing amortization of intangibles related to the acquisition. (Read more: Superior Industries Q4 Earnings Surpass Estimates)
Superior Industries carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
2. General Motors reported that it will invest more than $100 million for the development of its two assembly plants located in Michigan namely, Orion Township and Brownstown. This investment will be done to upgrade the plants for manufacturing self-driving vehicle, Cruise AV. The model is a rebranded version of General Motors’ Chevrolet Bolt EV.
Starting in 2019, the Cruise AV model will be produced at its Orion Township plant, while the roof modules will be assembled at its Brownstown battery assembly facility. Per management, the team members of these two plants are well prepared to manufacture Cruise AV as they already have experience in producing high-quality battery packs and autonomous test vehicles.
Intended for commercialization in 2019, the self-driving model will function without any driver, steering wheel, manual controls or throttle. (Read more: General Motors to Invest $100M for Cruise AV Production)
General Motors carries a Zacks Rank #2 (Buy).
3. Magna International Inc. and Lyft, a growing rideshare company, announced a multi-year partnership. The partnership intends to finance, build up and manufacture self-driving systems. Apart from this, Magna, a mobility company, has plans to invest $200 million in Lyft equity. However, the partnership is subject to certain regulatory approvals.
This partnership will enable Magna and Lyft to develop and manufacture self-driving systems effectively. In fact, Lyft’s expertise in ridesharing services and the automotive experience of Magna have the capability to make this collaboration a success.
Lyft will be the frontrunner in the co-development of the self-driving system at the Palo, Alto-based self-driving center. Magna is likely to lead the manufacturing of the car and join Lyft’s development team. In effect, Magna will lend its vehicle systems knowledge, manufacturing capabilities and safety and ADAS expertise. (Read more: Magna & Lyft Tie Up to Develop Self-Driving Systems)
Magna carries a Zacks Rank #3.
4. Volkswagen AG is planning to invest $340 million (£242 million) to upgrade its Chattanooga, TN facility. The amount will be used to manufacture a new sports utility vehicle (SUV), per Reuters. This decision was taken by the company after a surge in demand for large vehicles was observed.
The new five-passenger SUV will be added to the company’s Atlas family. In 2017, Volkswagen started selling its seven-passenger Atlas model and launched its all-new 2018 Tiguan SUV. A concept version of the new SUV will be launched next week at the New York International Auto Show.
In 2011, Volkswagen’s Chattanooga assembly plant started the production of Passat, a mid-sized sedan. Currently, a flourishing U.S. manufacturing plant produces three different vehicle models. (Read more: Volkswagen Plans to Invest $340M for SUV Production in US)
Volkswagen carries a Zacks Rank #2.
5. AutoZone, Inc.’s (AZO - Free Report) board of directors authorized a share buyback program worth $1 billion. This authorization is in addition to its current share repurchase program. Including this, the company’s board has approved $19.7 billion for buying back shares since 1998.
In second-quarter fiscal 2018, AutoZone reported earnings per share of $10.38, beating the Zacks Consensus Estimate of $8.81. Quarterly revenues rose 5.4% year over year to $2.41 billion. The top line also surpassed the Zacks Consensus Estimate. This continued strong financial performance and fine credit rating are permitting the company to repurchase stocks with an aim to boost shareholders’ confidence while maintaining enough liquidity at the same time.
Earlier this month, the company had increased its share repurchase authorization by $750 million. Prior to this, share buyback of the same amount was approved in March and September 2016. (Read more: AutoZone Announces $1B Share Repurchase Authorization)
AutoZone carries a Zacks Rank #3.
Performance
Last week, all these stocks, except Ford Motor Company (F - Free Report) recorded a decline. The sharpest decline was witnessed by Tesla, Inc. (TSLA - Free Report) .
In the last six months, the maximum rise was recorded by Advance Auto Parts, Inc. (AAP - Free Report) while Harley-Davidson, Inc. (HOG - Free Report) shares declined the most.
What’s Next in the Auto Space?
Watch out for the earnings releases and other developments in the sector in the coming days.
Zacks Editor-in-Chief Goes "All In" on This Stock
Full disclosure, Kevin Matras now has more of his own money in one particular stock than in any other. He believes in its short-term profit potential and also in its prospects to more than double by 2019. Today he reveals and explains his surprising move in a new Special Report.
Download it free >>