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.
Lear (LEA) Q2 Loss Narrower Than Expected, Sales Top, Down Y/Y
Read MoreHide Full Article
Lear Corporation’s (LEA - Free Report) second-quarter 2020 adjusted loss came in at $4.14 per share, narrower than the Zacks Consensus Estimate of loss of $4.98.
Higher-than-expected revenues in both of the company’s segments led to this narrower-than-expected loss. Notably, sales in the Seating and E-Systems segments totaled $1,755 million and $689.6 million, surpassing the Zacks Consensus Estimate of $1,325 million and $399 million, respectively. The company had recorded earnings of $3.78 per share in second-quarter 2019.
At the end of the second quarter, adjusted net loss was $248.6 million, as against the prior-year quarter’s net income of $235.8 million.
In the reported quarter, revenues plummeted 51% year over year to $2,445 million. This downside resulted from lower production amid the coronavirus pandemic and foreign-exchange rate fluctuations. The top-line figure, however, beat the Zacks Consensus Estimate of $2,136 million.
The company’s core operating loss was $248.3 million, as against the earnings of $351.6 million reported in second-quarter 2019.
Lear Corporation Price, Consensus and EPS Surprise
In the June-end quarter, sales in the Seating segment totaled $1,755 million, significantly down 54.3% year over year. Adjusted segmental loss came in at $102.1 million, as against the earnings of $314.5 million witnessed in the second quarter of 2019. However, the loss came in much narrower than the Zacks Consensus Estimate of a loss of $143 million. The segment recorded negative adjusted margins of 5.8% of sales.
Sales in the E-Systems segment summed $689.6 million, marking a 41% plunge, year over year, in the reported quarter. Adjusted segmental loss amounted to $91 million, as against the earnings of $93.9 million recorded in the year-ago quarter. This loss is, however, narrower than the consensus mark of a loss of $106 million. For the E-Systems segment, adjusted margin was a negative 13.2% of sales.
Financial Position
The company had $1,775.5 million of cash and cash equivalents as of Jul 4, 2020, compared with $1,487.7 million recorded as of Dec 31, 2019. It had a long-term debt of $2302.7 million as of Jul 4, 2020, compared with $2,293.7 million recorded as of Dec 31, 2019.
At the end of the April-June quarter, Lear’s net operating cash outflow was $524.5 million, as against the cash inflow of $404.3 million as of Jun 29, 2019. During the reported period, its capital expenditure amounted to $86.1 million, down from the $136.5 million witnessed in the prior-year quarter.
Lear has suspended the 2020 guidance as it expects the pandemic’s crippling impact to strain its operations in the days to come.
Shares of AutoNation have rallied 8.2%, year to date, compared with the industry’s gain of 7.5%.
Shares of LCI Industries have appreciated 19.1%, year to date, as against the industry’s decline of 6.2%.
Shares of Geely Automobile have appreciated 11.8%, year to date, as against the industry’s decline of 13.4%.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
Image: Bigstock
Lear (LEA) Q2 Loss Narrower Than Expected, Sales Top, Down Y/Y
Lear Corporation’s (LEA - Free Report) second-quarter 2020 adjusted loss came in at $4.14 per share, narrower than the Zacks Consensus Estimate of loss of $4.98.
Higher-than-expected revenues in both of the company’s segments led to this narrower-than-expected loss. Notably, sales in the Seating and E-Systems segments totaled $1,755 million and $689.6 million, surpassing the Zacks Consensus Estimate of $1,325 million and $399 million, respectively. The company had recorded earnings of $3.78 per share in second-quarter 2019.
At the end of the second quarter, adjusted net loss was $248.6 million, as against the prior-year quarter’s net income of $235.8 million.
In the reported quarter, revenues plummeted 51% year over year to $2,445 million. This downside resulted from lower production amid the coronavirus pandemic and foreign-exchange rate fluctuations. The top-line figure, however, beat the Zacks Consensus Estimate of $2,136 million.
The company’s core operating loss was $248.3 million, as against the earnings of $351.6 million reported in second-quarter 2019.
Lear Corporation Price, Consensus and EPS Surprise
Lear Corporation price-consensus-eps-surprise-chart | Lear Corporation Quote
Segment Performances
In the June-end quarter, sales in the Seating segment totaled $1,755 million, significantly down 54.3% year over year. Adjusted segmental loss came in at $102.1 million, as against the earnings of $314.5 million witnessed in the second quarter of 2019. However, the loss came in much narrower than the Zacks Consensus Estimate of a loss of $143 million. The segment recorded negative adjusted margins of 5.8% of sales.
Sales in the E-Systems segment summed $689.6 million, marking a 41% plunge, year over year, in the reported quarter. Adjusted segmental loss amounted to $91 million, as against the earnings of $93.9 million recorded in the year-ago quarter. This loss is, however, narrower than the consensus mark of a loss of $106 million. For the E-Systems segment, adjusted margin was a negative 13.2% of sales.
Financial Position
The company had $1,775.5 million of cash and cash equivalents as of Jul 4, 2020, compared with $1,487.7 million recorded as of Dec 31, 2019. It had a long-term debt of $2302.7 million as of Jul 4, 2020, compared with $2,293.7 million recorded as of Dec 31, 2019.
At the end of the April-June quarter, Lear’s net operating cash outflow was $524.5 million, as against the cash inflow of $404.3 million as of Jun 29, 2019. During the reported period, its capital expenditure amounted to $86.1 million, down from the $136.5 million witnessed in the prior-year quarter.
Lear has suspended the 2020 guidance as it expects the pandemic’s crippling impact to strain its operations in the days to come.
Zacks Rank & Stocks to Consider
Lear currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the auto sector include AutoNation (AN - Free Report) , LCI Industries (LCII - Free Report) and Geely Automobile Holdings Ltd. (GELYY - Free Report) . While AutoNation and LCI Industries sport a Zacks Rank of 1, Geely Automobile carries a Zacks Rank of 2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of AutoNation have rallied 8.2%, year to date, compared with the industry’s gain of 7.5%.
Shares of LCI Industries have appreciated 19.1%, year to date, as against the industry’s decline of 6.2%.
Shares of Geely Automobile have appreciated 11.8%, year to date, as against the industry’s decline of 13.4%.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>