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American Axle & Manufacturing (AXL) Stock Sinks As Market Gains: What You Should Know

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In the latest trading session, American Axle & Manufacturing (AXL - Free Report) closed at $8.69, marking a -0.46% move from the previous day. This change lagged the S&P 500's daily gain of 0.15%.

Prior to today's trading, shares of the maker of auto parts had gained 0.92% over the past month. This has lagged the Auto-Tires-Trucks sector's gain of 4.96% and outpaced the S&P 500's loss of 0.58% in that time.

AXL will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.22, down 80.87% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $1.35 billion, down 4.74% from the year-ago period.

AXL's full-year Zacks Consensus Estimates are calling for earnings of $1.38 per share and revenue of $5.48 billion. These results would represent year-over-year changes of +885.71% and +16.33%, respectively.

It is also important to note the recent changes to analyst estimates for AXL. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 6.77% lower. AXL is currently a Zacks Rank #3 (Hold).

Investors should also note AXL's current valuation metrics, including its Forward P/E ratio of 6.34. This valuation marks a discount compared to its industry's average Forward P/E of 12.6.

Meanwhile, AXL's PEG ratio is currently 0.79. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Automotive - Original Equipment was holding an average PEG ratio of 0.73 at yesterday's closing price.

The Automotive - Original Equipment industry is part of the Auto-Tires-Trucks sector. This industry currently has a Zacks Industry Rank of 203, which puts it in the bottom 21% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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