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Volkswagen (VWAGY) Group's Scania to Invest $344M in Brazil
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Volkswagen AG’s (VWAGY - Free Report) truck brand Scania made the announcement to invest 1.4 billion reais ($344.14 million) to modernize its factory in Sao Bernardo do Campo, Brazil, per Reuters. In a joint statement with the Sao Paulo state government, it revealed that the new investment will begin in 2021 and end in 2024.
Scania, which is the long-standing Swedish brand, manufactures heavy trucks, buses and engines. It now aims to overhaul its assembly line as well as to launch a new generation of trucks in Latin America.
Per the local automakers association — Anfavea, in the first four months of 2019, the sale of Scania heavy trucks increased 31% on a year-over-year basis. Notably, the latest decision of this company under the Volkswagen Group has come after Ford Motor Company’s (F - Free Report) decision to exit the heavy truck business in South America and close its plant in Sao Bernardo do Campo.
Another auto giant, General Motors Company (GM - Free Report) also thought of big cuts in its Sao Paulo factories. This prompted aggressive negotiation by the state governor. Finally, General Motors decided to invest $2.7 billion to take advantage of the tax program. In this backdrop, the decision of Volkswagen to invest in the historic center of Brazil’s auto industry is very significant.
Over the past three months, shares of Volkswagen have outperformed the industry it belongs to. During the said period, shares of the company have lost 4.2% compared with the industry’s 6.6% decline.
While Ford currently carries a Zacks Rank #2 (Buy), Volkswagen and General Motors have a Zacks Rank #3 (Hold). Volkswagen, Ford and General Motors have expected long-term growth rates of 4.8%, 7.3% and 8.9%, respectively.
Fox Factory has an expected long-term growth rate of 16.4%. Over the past three months, shares of the company have gained 14.3%.
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This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
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Volkswagen (VWAGY) Group's Scania to Invest $344M in Brazil
Volkswagen AG’s (VWAGY - Free Report) truck brand Scania made the announcement to invest 1.4 billion reais ($344.14 million) to modernize its factory in Sao Bernardo do Campo, Brazil, per Reuters. In a joint statement with the Sao Paulo state government, it revealed that the new investment will begin in 2021 and end in 2024.
Scania, which is the long-standing Swedish brand, manufactures heavy trucks, buses and engines. It now aims to overhaul its assembly line as well as to launch a new generation of trucks in Latin America.
Per the local automakers association — Anfavea, in the first four months of 2019, the sale of Scania heavy trucks increased 31% on a year-over-year basis. Notably, the latest decision of this company under the Volkswagen Group has come after Ford Motor Company’s (F - Free Report) decision to exit the heavy truck business in South America and close its plant in Sao Bernardo do Campo.
Another auto giant, General Motors Company (GM - Free Report) also thought of big cuts in its Sao Paulo factories. This prompted aggressive negotiation by the state governor. Finally, General Motors decided to invest $2.7 billion to take advantage of the tax program. In this backdrop, the decision of Volkswagen to invest in the historic center of Brazil’s auto industry is very significant.
Over the past three months, shares of Volkswagen have outperformed the industry it belongs to. During the said period, shares of the company have lost 4.2% compared with the industry’s 6.6% decline.
While Ford currently carries a Zacks Rank #2 (Buy), Volkswagen and General Motors have a Zacks Rank #3 (Hold). Volkswagen, Ford and General Motors have expected long-term growth rates of 4.8%, 7.3% and 8.9%, respectively.
One better-ranked stock in the auto space is Fox Factory Holding Corp. (FOXF - Free Report) , which currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Fox Factory has an expected long-term growth rate of 16.4%. Over the past three months, shares of the company have gained 14.3%.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
See their latest picks free >>