Tenneco Inc.’s shares appreciated 32.2% after the company reported outstanding quarterly results on May 6. The Illinois-based auto supplier not just delivered a comprehensive beat but also posted higher year-over-year earnings and sales.In the light of improving margins across all segments and better free cash flow performance on the back of the firm’s Accelerate+ program, Tenneco has raised its 2021 outlook. The company expects 2021 adjusted EBITDA in the band of $1.35-$1.45 billion, higher than the previous guidance of $1.3-$1.4 billion.
Full-year revenues are envisioned within $17.6-$18.1 billion, up from the prior outlook of $17.2-$17.8 billion. Management anticipates net debt to be less than $4.2 billion at the end of 2021, down from the $4.5 billion recorded as of Dec 31, 2020.
Q1 Earnings Highlights
Tenneco reported adjusted earnings of $1.09 per share for first-quarter 2021, surpassing the Zacks Consensus Estimate of 71 cents. Higher-than-expected contribution from Clean Air, Performance Solutions and Motorparts segments led to this outperformance. The reported figure also compares favorably with the year-ago loss of 31 cents.Revenues of $4,731 million topped the Zacks Consensus Estimate of $4,394 million and increased 23% year over year. Adjusted EBITDA for the March-end quarter came in at $388 million, jumping 62% from the year-ago period.
Segmental Performance
For the January-March period, the Clean Air division’s revenues summed $1,036 million, higher than the year-ago figure of $845 million. The metric, however, missed the Zacks Consensus Estimate of $1,933 million. Adjusted EBITDA totaled $157 million for the quarter, up from the year-ago quarter’s $104 million. The reported EBITDA also topped the consensus metric of $142 million.
For the first quarter, revenues in the newly-named Performance Solutions division (formerly called Ride Performance segment) came in at $787 million, increasing from the $588 million recorded in the year-earlier period and surpassing the consensus mark of $636 million.
Adjusted EBITDA totaled $47 million in the March-end quarter, rising from the $38 million witnessed in the prior-year quarter. The reported EBITDA also beat the consensus metric of $24.71 million.The Powertrain division’s revenues amounted to $1,101 million for the first quarter, rising from the $916 million registered in the year-earlier period and marginally outpacing the consensus mark of $1,088 million. Adjusted EBITDA came in at $126 million for the reported quarter, up from the year-ago quarter’s $68 million. The reported EBITDA was at par with the consensus metric.
The Motorparts division’s revenues came in at $719 million, up from the $706 million generated in first-quarter 2020. The revenue figure, however, missed the Zacks Consensus Estimate of $727 million. Adjusted EBITDA totaled $105 million for the quarter, up from the $73 million generated in the corresponding period of 2020. The reported EBITDA also beat the consensus metric of $86 million.
Financial Position & Q2 Outlook
Tenneco — which shares space with Magna International (MGA - Free Report) , Meritor and American Axle & Manufacturing (AXL - Free Report) — had cash and cash equivalents of $626 million as of Mar 31, 2021 compared with $767 million in the corresponding period of 2020. Long-term debt totaled $5,111 million, down from $5,837 million as of Mar 31, 2020. During the first quarter, the company’s net cash used by operating activities was $50 million compared with the year-earlier quarter’s outflow $152 million.During the reported quarter, Tenneco completed refinancing to extend debt maturities of $800 million from 2024 to 2029, boosting the company's maturity profile and enhancing its financial flexibility.
For the second quarter of 2021, Tenneco — which currently carries a Zacks Rank #3 (Hold) — projects revenues between $4.35 billion and $4.55 billion. Adjusted EBITDA is forecast in the band of $325-$355 million.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2021 today >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Tenneco Inc.’s shares appreciated 32.2% after the company reported outstanding quarterly results on May 6. The Illinois-based auto supplier not just delivered a comprehensive beat but also posted higher year-over-year earnings and sales.
In the light of improving margins across all segments and better free cash flow performance on the back of the firm’s Accelerate+ program, Tenneco has raised its 2021 outlook. The company expects 2021 adjusted EBITDA in the band of $1.35-$1.45 billion, higher than the previous guidance of $1.3-$1.4 billion.
Full-year revenues are envisioned within $17.6-$18.1 billion, up from the prior outlook of $17.2-$17.8 billion. Management anticipates net debt to be less than $4.2 billion at the end of 2021, down from the $4.5 billion recorded as of Dec 31, 2020.
Q1 Earnings Highlights
Tenneco reported adjusted earnings of $1.09 per share for first-quarter 2021, surpassing the Zacks Consensus Estimate of 71 cents. Higher-than-expected contribution from Clean Air, Performance Solutions and Motorparts segments led to this outperformance. The reported figure also compares favorably with the year-ago loss of 31 cents.
Revenues of $4,731 million topped the Zacks Consensus Estimate of $4,394 million and increased 23% year over year. Adjusted EBITDA for the March-end quarter came in at $388 million, jumping 62% from the year-ago period.
Segmental Performance
For the January-March period, the Clean Air division’s revenues summed $1,036 million, higher than the year-ago figure of $845 million. The metric, however, missed the Zacks Consensus Estimate of $1,933 million. Adjusted EBITDA totaled $157 million for the quarter, up from the year-ago quarter’s $104 million. The reported EBITDA also topped the consensus metric of $142 million.
For the first quarter, revenues in the newly-named Performance Solutions division (formerly called Ride Performance segment) came in at $787 million, increasing from the $588 million recorded in the year-earlier period and surpassing the consensus mark of $636 million.
Adjusted EBITDA totaled $47 million in the March-end quarter, rising from the $38 million witnessed in the prior-year quarter. The reported EBITDA also beat the consensus metric of $24.71 million.
The Powertrain division’s revenues amounted to $1,101 million for the first quarter, rising from the $916 million registered in the year-earlier period and marginally outpacing the consensus mark of $1,088 million. Adjusted EBITDA came in at $126 million for the reported quarter, up from the year-ago quarter’s $68 million. The reported EBITDA was at par with the consensus metric.
The Motorparts division’s revenues came in at $719 million, up from the $706 million generated in first-quarter 2020. The revenue figure, however, missed the Zacks Consensus Estimate of $727 million. Adjusted EBITDA totaled $105 million for the quarter, up from the $73 million generated in the corresponding period of 2020. The reported EBITDA also beat the consensus metric of $86 million.
Financial Position & Q2 Outlook
Tenneco — which shares space with Magna International (MGA - Free Report) , Meritor and American Axle & Manufacturing (AXL - Free Report) — had cash and cash equivalents of $626 million as of Mar 31, 2021 compared with $767 million in the corresponding period of 2020. Long-term debt totaled $5,111 million, down from $5,837 million as of Mar 31, 2020. During the first quarter, the company’s net cash used by operating activities was $50 million compared with the year-earlier quarter’s outflow $152 million.
During the reported quarter, Tenneco completed refinancing to extend debt maturities of $800 million from 2024 to 2029, boosting the company's maturity profile and enhancing its financial flexibility.
For the second quarter of 2021, Tenneco — which currently carries a Zacks Rank #3 (Hold) — projects revenues between $4.35 billion and $4.55 billion. Adjusted EBITDA is forecast in the band of $325-$355 million.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2021 today >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Get the latest research report on AXL - FREE
Get the latest research report on MGA - FREE