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Superior Industries (SUP) Q4 Earnings Drive Past Estimates

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Superior Industries International, Inc. (SUP - Free Report) reported adjusted loss of 16 cents in fourth-quarter 2018, narrower than the Zacks Consensus Estimate of loss of 20 cents. Including the benefit of acquisition and one-time items, the company’s earnings were 77 cents per share.

Net sales were $378.8 million in the reported quarter, beating the Zacks Consensus Estimate of $371 million. The reported figure was higher than $361.8 million recorded in the year-ago quarter. The quarterly increase was on the back of rise in aluminum prices, larger diameter wheels and increased shipments for European operations.

During the fourth quarter, the company’s wheel unit shipments declined 3.7% year over year to 5.2 million. The decline was primarily due to reduced volume in North America, partly offset by increased shipments for Europe. Gross profit fell to $36.3 million from $39.7 million in the year-ago quarter.

Superior Industries International, Inc. Price, Consensus and EPS Surprise

 

Selling, general and administrative expenses contracted to $17.1 million (4.5% of net sales) in fourth-quarter 2018 from $25.9 million (7.2% of net sales) a year ago due to reduced acquisition and integration-related expenses.

2018 Results

In 2018, the company posted net income of $26 million or earnings of 29 cents per share, whereas net loss was $6.2 million or loss of $1.01 per share in the prior year.

The company’s net sales were $1.5 billion compared with $1.1 billion recorded in 2017.

Financial Details

At the end of the reported quarter, Superior Industries’ net cash provided by operating activities was $91.8 million compared with $46.5 million in the year-ago period. Capital expenditure totaled $22.2 million, marking an increase from $14.1 million recorded in the prior-year quarter.

Outlook

In 2019, Superior Industries projects unit shipments of 19.85-20.30 million, which are likely to drive net sales to $1.42-$1.47 billion. Value-added sales are projected to be $765-$805 million. Adjusted EBITDA is expected to be $170-$185 million. Further, capital expenditure is projected to be around $85 million while cash flow from operation is expected to be $125-$145 million.

Over the past month, shares of Superior Industries have outperformed the industry it belongs to. During that period, shares of the company gained 11.9% against the industry’s decrease of 0.6%.


Zacks Rank & Other Key Picks

Superior Industries currently carries a Zacks Rank #2 (Buy). A few other top-ranked stocks in the broader auto sector are Oshkosh Corporation (OSK - Free Report) , CarGurus, Inc. (CARG - Free Report) and Fox Factory Holding Corporation (FOXF - Free Report) , each presently carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Oshkosh has an expected long-term growth rate of 11.3%. Shares of the company have gained 20.2% in the past three months.

CarGurus has an expected long-term growth rate of 5%. Share price of the company has increased 8.9% in the past three months.

Fox Factory has an expected long-term growth rate of 15.1%. Over the past month, shares of the company have gained 2%.

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