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American Axle (AXL) Beats on Q3 Earnings & Sales, Trims '22 View
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American Axle & Manufacturing Holdings (AXL - Free Report) reported earnings of 27 cents per share in third-quarter 2022, beating the Zacks Consensus Estimate of 23 cents. Higher-than-anticipated EBITDA from the Driveline unit and higher-than-expected sales from the Metal Forming segment resulted in the outperformance. The bottom line shot up 80% from 15 cents a share earned a year ago. The company generated quarterly revenues of $1,535.2 million, surpassing the Zacks Consensus Estimate of $1,441 million. Revenues increased 26.5% on a year-over-year basis, led by favorable impacts of supply chain improvements, volume and mix and the Tekfor acquisition.
American Axle & Manufacturing Holdings, Inc. Price, Consensus and EPS Surprise
In the reported quarter, the Driveline segment recorded sales of $1,061.1 million, rising 22% year over year but missing the Zacks Consensus Estimate of $1,083 million. The segment registered adjusted EBITDA of $146.4 million, up 14% and beating the consensus mark of $140 million.
The company’s Metal Forming business generated revenues of $591.2 million during the quarter, an increase of 40% from the year-ago figure. It crossed the consensus estimate of $416 million. The segment witnessed adjusted EBITDA of $52 million, falling 5.1% and lagging the consensus mark of $70 million.
Financial Position
American Axle’s third-quarter SG&A expenses totaled $85.7 million, down from $90.5 million incurred in the prior-year quarter.
In the three months ended Sep 30, 2022, the company posted an adjusted free cash flow of $45.8 million, falling from $69.1 million recorded in the year-earlier period. Capital spending in the quarter was $46.6 million, up from $33.2 million. Net cash provided by operating activities was $85.2 million, declining from $89.8 million in the year-ago period.
In the quarter, American Axle had cash and cash equivalents of $472.3 million compared with $530.2 million on Dec 31, 2021. Its net long-term debt was $2,974.1 million, down from $3,085.7 million as of Dec 31, 2021.
2022 Outlook Revised
American Axle updated its outlook for 2022. It now envisions revenues in the range of $5.75-$5.85 billion, down from the prior range of $5.75-$5.95 billion. Estimation for adjusted EBITDA is now in the range of $745-$765 million instead of $790-$830 million projected earlier. Adjusted FCF has been brought down to approximately $300 million from $300-$350 million, considering capital spending between 3% and 3.5% of sales.
Cummins has an expected earnings growth rate of 18.4% for the current year. The Zacks Consensus Estimate for CMI’s current-year earnings has been revised 0.4% upward in the past 30 days.
CarParts has an expected earnings growth rate of 45% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant over the past 30 days.
Genuine Parts has an expected earnings growth rate of 18.1% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised 2.4% upward over the past 30 days.
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American Axle (AXL) Beats on Q3 Earnings & Sales, Trims '22 View
American Axle & Manufacturing Holdings (AXL - Free Report) reported earnings of 27 cents per share in third-quarter 2022, beating the Zacks Consensus Estimate of 23 cents. Higher-than-anticipated EBITDA from the Driveline unit and higher-than-expected sales from the Metal Forming segment resulted in the outperformance. The bottom line shot up 80% from 15 cents a share earned a year ago. The company generated quarterly revenues of $1,535.2 million, surpassing the Zacks Consensus Estimate of $1,441 million. Revenues increased 26.5% on a year-over-year basis, led by favorable impacts of supply chain improvements, volume and mix and the Tekfor acquisition.
American Axle & Manufacturing Holdings, Inc. Price, Consensus and EPS Surprise
American Axle & Manufacturing Holdings, Inc. price-consensus-eps-surprise-chart | American Axle & Manufacturing Holdings, Inc. Quote
Segmental Performance
In the reported quarter, the Driveline segment recorded sales of $1,061.1 million, rising 22% year over year but missing the Zacks Consensus Estimate of $1,083 million. The segment registered adjusted EBITDA of $146.4 million, up 14% and beating the consensus mark of $140 million.
The company’s Metal Forming business generated revenues of $591.2 million during the quarter, an increase of 40% from the year-ago figure. It crossed the consensus estimate of $416 million. The segment witnessed adjusted EBITDA of $52 million, falling 5.1% and lagging the consensus mark of $70 million.
Financial Position
American Axle’s third-quarter SG&A expenses totaled $85.7 million, down from $90.5 million incurred in the prior-year quarter.
In the three months ended Sep 30, 2022, the company posted an adjusted free cash flow of $45.8 million, falling from $69.1 million recorded in the year-earlier period. Capital spending in the quarter was $46.6 million, up from $33.2 million. Net cash provided by operating activities was $85.2 million, declining from $89.8 million in the year-ago period.
In the quarter, American Axle had cash and cash equivalents of $472.3 million compared with $530.2 million on Dec 31, 2021. Its net long-term debt was $2,974.1 million, down from $3,085.7 million as of Dec 31, 2021.
2022 Outlook Revised
American Axle updated its outlook for 2022. It now envisions revenues in the range of $5.75-$5.85 billion, down from the prior range of $5.75-$5.95 billion. Estimation for adjusted EBITDA is now in the range of $745-$765 million instead of $790-$830 million projected earlier. Adjusted FCF has been brought down to approximately $300 million from $300-$350 million, considering capital spending between 3% and 3.5% of sales.
Zacks Rank & Key Picks
AXL currently has a Zacks Rank #4 (Sell).
Some better-ranked players in the auto space are Cummins Inc. (CMI - Free Report) , CarParts.com (PRTS - Free Report) and Genuine Parts Company (GPC - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.
Cummins has an expected earnings growth rate of 18.4% for the current year. The Zacks Consensus Estimate for CMI’s current-year earnings has been revised 0.4% upward in the past 30 days.
CarParts has an expected earnings growth rate of 45% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant over the past 30 days.
Genuine Parts has an expected earnings growth rate of 18.1% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised 2.4% upward over the past 30 days.