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4 Auto Companies Likely to Beat Earnings Expectations in Q1
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The first-quarter earnings season for the Auto-Tires-Trucks sector is underway. So far, two S&P 500 sector components— Tesla and Genuine Parts— have reported quarterly numbers. While Tesla beat earnings expectations, Genuine Parts missed the same.
Per the Earnings Trend report dated April 22, the auto sector’s earnings for first-quarter 2025 are expected to grow 10.9% on a year-over-year basis. Revenues are also estimated to increase 3.4%.
With a majority of companies left to release first-quarter results, we have identified — with the help of the Zacks Stock Screener — a few auto players, which are positioned to outshine the Zacks Consensus Estimate this earnings season.
These include General Motors (GM - Free Report) , Lear Corp. (LEA - Free Report) , Magna International (MGA - Free Report) and Allison Transmission (ALSN - Free Report) . Before we discuss the companies, let’s take a look at the factors shaping the quarterly performance.
Factors at Play
The U.S. auto market slowed in the first quarter of 2026, but the picture isn’t entirely weak. Part of the decline reflects tough comparisons, as last year’s demand was boosted by pre-tariff buying. That pull-forward effect naturally cooled volumes this year.
Affordability pressures remained a key headwind. High vehicle prices and elevated interest rates kept many buyers on the sidelines, leading to softer retail vehicle demand. Harsh winter weather and rising fuel costs added to the cautious consumer backdrop. Per GlobalData, retail vehicle sales dropped 16% last month. Fleet demand held relatively steady, declining just over 2%
While the seasonally adjusted annual rate (SAAR) showed some improvement from February levels, it remained well below last year’s pace. For the quarter, SAAR was around 15.5 million units per Cox Automotive, down from 16 million.
Overall, the industry settled into a slower gear in the first quarter. Amid high prices, lingering supply challenges and normalization after last year’s demand spike, the environment became more challenging.
Picking Potential Winners
Despite the weak backdrop, a few companies are expected to outperform this earnings season. While it is not possible to be sure about which companies are well-positioned to beat earnings estimates, our proprietary methodology — Earnings ESP — makes it relatively simple. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. Earnings ESP shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate.
Our research shows that for stocks with the abovementioned combination, the chances of an earnings beat are as high as 70%.
Our Choices
General Motors: Its U.S. sales in the first quarter totaled 626,429 vehicles, down 9.7% compared with the same period a year earlier. Lower U.S. deliveries are likely to have impacted the company’s top-line growth in the first quarter of 2026. However, GM is gaining strong momentum in its software and services business. Rising subscriptions are likely to have boosted the company’s performance in the to-be-reported quarter.
The consensus estimate for wholesale vehicle sales in the GMNA segment is 800,000 units, implying a decline of 0.32%. Estimates for GMNA unit’s revenues and adjusted EBIT also imply a year-over-year contraction of 2.6% and 17.7%, respectively. Things are looking better on the international front. The consensus estimate for wholesale vehicle sales in the GMI segment is 129,000 units, implying a jump of 51.7%. Estimates for GMI unit’s revenues and adjusted EBIT also imply year-over-year growth of 51% and 383%, respectively.
GM has an Earnings ESP of +5.66% and a Zacks Rank #3. The company is scheduled to release first-quarter results tomorrow. The Zacks Consensus Estimate for General Motors’ to-be-reported quarter’s earnings and revenues is pegged at $2.61 per share and $44 billion, respectively. EPS estimates for the first quarter have moved up by 2 cents in the past seven days. General Motors surpassed earnings estimates in each of the trailing four quarters.
Lear: It has been riding high on strategic acquisitions. The acquisition of Kongsberg Automotive Interior Comfort Systems, IGB, and Grupo Antolin's seating business is enhancing the vertical integration capabilities of the Seating business.The acquisition of WIP Industrial Automation will enable Lear to improve operational efficiency. IDEA programs and automation are expected to generate savings.
The Zacks Consensus Estimate for LEA’s Seating segment revenues is pegged at $4.5 billion, up from $4.15 billion recorded in the year-ago period. The estimate for the unit’s adjusted earnings is $289 million, suggesting an uptick from $280 million in the year-ago period. These gains, however, are anticipated to be partly offset by projected declines in the E-Systems unit. The consensus mark for Lear’s revenues and adjusted earnings from the E-Systems unit calls for a year-over-year decline of 0.4% and 2.7%, respectively.
Lear has an Earnings ESP of +3.02% and a Zacks Rank #3. The company is scheduled to release first-quarter results on May 1. The Zacks Consensus Estimate for LEA’s to-be-reported quarter’s earnings and revenues is pegged at $3.37 per share and $5.84 billion, respectively. The EPS estimate for the first quarter has moved up by 9 cents in the past 30 days. Lear surpassed earnings estimates in each of the trailing four quarters.
Magna: It has been benefiting from diversified offerings, strong bookings and strategic technology partnerships. The company has also been accelerating operational excellence initiatives, including unified digital architecture, real-time performance dashboards, AI-enabled automation and material flow optimization, driving sustainable productivity gains and continued margin expansion.
The Zacks Consensus Estimate for Magna’s Body Exteriors & Structures segment adjusted EBIT is pegged at $249 million, up from $230 million recorded in the year-ago period. The estimate for the Power & Vision segment’s adjusted earnings is $172 million, suggesting an uptick from $124 million in the year-ago period. These gains, however, are anticipated to be partly offset by projected declines in Complete Vehicles as well as Seating segments.
Magna has an Earnings ESP of +8.56% and a Zacks Rank #2. The company is scheduled to release first-quarter results on May 1. The Zacks Consensus Estimate for MGA’s to-be-reported quarter’s earnings and revenues is pegged at $1.01 per share and $10.1 billion, respectively. The EPS estimate for the first quarter has moved down by 2 cents in the past seven days. Magna surpassed earnings estimates in three of the trailing four quarters and missed once.
Allison: The company is well-positioned to benefit from rising global defense budgets. The 3040MX platform is emerging as a key growth driver. International expansion represents a major long-term growth opportunity. International On-Highway remains one of Allison’s largest untapped opportunities. ALSN’s eGen Flex portfolio and the eGen Force portfolio are driving Allison’s prospects.
The Zacks Consensus Estimate for revenues from Defense, Outside North America On- Highway and Service Parts, Support Equipment & Other segments is pegged at $65 million, $122 million and $152 million, implying an uptick of 22.6%, 9% and 3%, respectively. These gains are expected to have been somewhat offset by the projected decline in revenues from the North America On-Highway unit.
Allison has an Earnings ESP of +25.84% and a Zacks Rank #3. The company is scheduled to release first-quarter results on May 4. The Zacks Consensus Estimate for ALSN’s to-be-reported quarter’s earnings and revenues is pegged at $2.54 per share and $1.38 billion, respectively. The EPS estimate for the first quarter has moved up by a cent in the past 30 days. Allison surpassed earnings estimates in three of the trailing four quarters and missed once.
Allison Transmission Holdings, Inc. Price and EPS Surprise
View the Zacks #1 Rank List
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4 Auto Companies Likely to Beat Earnings Expectations in Q1
The first-quarter earnings season for the Auto-Tires-Trucks sector is underway. So far, two S&P 500 sector components— Tesla and Genuine Parts— have reported quarterly numbers. While Tesla beat earnings expectations, Genuine Parts missed the same.
Per the Earnings Trend report dated April 22, the auto sector’s earnings for first-quarter 2025 are expected to grow 10.9% on a year-over-year basis. Revenues are also estimated to increase 3.4%.
With a majority of companies left to release first-quarter results, we have identified — with the help of the Zacks Stock Screener — a few auto players, which are positioned to outshine the Zacks Consensus Estimate this earnings season.
These include General Motors (GM - Free Report) , Lear Corp. (LEA - Free Report) , Magna International (MGA - Free Report) and Allison Transmission (ALSN - Free Report) . Before we discuss the companies, let’s take a look at the factors shaping the quarterly performance.
Factors at Play
The U.S. auto market slowed in the first quarter of 2026, but the picture isn’t entirely weak. Part of the decline reflects tough comparisons, as last year’s demand was boosted by pre-tariff buying. That pull-forward effect naturally cooled volumes this year.
Affordability pressures remained a key headwind. High vehicle prices and elevated interest rates kept many buyers on the sidelines, leading to softer retail vehicle demand. Harsh winter weather and rising fuel costs added to the cautious consumer backdrop. Per GlobalData, retail vehicle sales dropped 16% last month. Fleet demand held relatively steady, declining just over 2%
While the seasonally adjusted annual rate (SAAR) showed some improvement from February levels, it remained well below last year’s pace. For the quarter, SAAR was around 15.5 million units per Cox Automotive, down from 16 million.
Overall, the industry settled into a slower gear in the first quarter. Amid high prices, lingering supply challenges and normalization after last year’s demand spike, the environment became more challenging.
Picking Potential Winners
Despite the weak backdrop, a few companies are expected to outperform this earnings season. While it is not possible to be sure about which companies are well-positioned to beat earnings estimates, our proprietary methodology — Earnings ESP — makes it relatively simple. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. Earnings ESP shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Our research shows that for stocks with the abovementioned combination, the chances of an earnings beat are as high as 70%.
Our Choices
General Motors: Its U.S. sales in the first quarter totaled 626,429 vehicles, down 9.7% compared with the same period a year earlier. Lower U.S. deliveries are likely to have impacted the company’s top-line growth in the first quarter of 2026. However, GM is gaining strong momentum in its software and services business. Rising subscriptions are likely to have boosted the company’s performance in the to-be-reported quarter.
The consensus estimate for wholesale vehicle sales in the GMNA segment is 800,000 units, implying a decline of 0.32%. Estimates for GMNA unit’s revenues and adjusted EBIT also imply a year-over-year contraction of 2.6% and 17.7%, respectively. Things are looking better on the international front. The consensus estimate for wholesale vehicle sales in the GMI segment is 129,000 units, implying a jump of 51.7%. Estimates for GMI unit’s revenues and adjusted EBIT also imply year-over-year growth of 51% and 383%, respectively.
GM has an Earnings ESP of +5.66% and a Zacks Rank #3. The company is scheduled to release first-quarter results tomorrow. The Zacks Consensus Estimate for General Motors’ to-be-reported quarter’s earnings and revenues is pegged at $2.61 per share and $44 billion, respectively. EPS estimates for the first quarter have moved up by 2 cents in the past seven days. General Motors surpassed earnings estimates in each of the trailing four quarters.
General Motors Company Price and EPS Surprise
General Motors Company price-eps-surprise | General Motors Company Quote
Lear: It has been riding high on strategic acquisitions. The acquisition of Kongsberg Automotive Interior Comfort Systems, IGB, and Grupo Antolin's seating business is enhancing the vertical integration capabilities of the Seating business.The acquisition of WIP Industrial Automation will enable Lear to improve operational efficiency. IDEA programs and automation are expected to generate savings.
The Zacks Consensus Estimate for LEA’s Seating segment revenues is pegged at $4.5 billion, up from $4.15 billion recorded in the year-ago period. The estimate for the unit’s adjusted earnings is $289 million, suggesting an uptick from $280 million in the year-ago period. These gains, however, are anticipated to be partly offset by projected declines in the E-Systems unit. The consensus mark for Lear’s revenues and adjusted earnings from the E-Systems unit calls for a year-over-year decline of 0.4% and 2.7%, respectively.
Lear has an Earnings ESP of +3.02% and a Zacks Rank #3. The company is scheduled to release first-quarter results on May 1. The Zacks Consensus Estimate for LEA’s to-be-reported quarter’s earnings and revenues is pegged at $3.37 per share and $5.84 billion, respectively. The EPS estimate for the first quarter has moved up by 9 cents in the past 30 days. Lear surpassed earnings estimates in each of the trailing four quarters.
Lear Corporation Price and EPS Surprise
Lear Corporation price-eps-surprise | Lear Corporation Quote
Magna: It has been benefiting from diversified offerings, strong bookings and strategic technology partnerships. The company has also been accelerating operational excellence initiatives, including unified digital architecture, real-time performance dashboards, AI-enabled automation and material flow optimization, driving sustainable productivity gains and continued margin expansion.
The Zacks Consensus Estimate for Magna’s Body Exteriors & Structures segment adjusted EBIT is pegged at $249 million, up from $230 million recorded in the year-ago period. The estimate for the Power & Vision segment’s adjusted earnings is $172 million, suggesting an uptick from $124 million in the year-ago period. These gains, however, are anticipated to be partly offset by projected declines in Complete Vehicles as well as Seating segments.
Magna has an Earnings ESP of +8.56% and a Zacks Rank #2. The company is scheduled to release first-quarter results on May 1. The Zacks Consensus Estimate for MGA’s to-be-reported quarter’s earnings and revenues is pegged at $1.01 per share and $10.1 billion, respectively. The EPS estimate for the first quarter has moved down by 2 cents in the past seven days. Magna surpassed earnings estimates in three of the trailing four quarters and missed once.
Magna International Inc. Price and EPS Surprise
Magna International Inc. price-eps-surprise | Magna International Inc. Quote
Allison: The company is well-positioned to benefit from rising global defense budgets. The 3040MX platform is emerging as a key growth driver. International expansion represents a major long-term growth opportunity. International On-Highway remains one of Allison’s largest untapped opportunities. ALSN’s eGen Flex portfolio and the eGen Force portfolio are driving Allison’s prospects.
The Zacks Consensus Estimate for revenues from Defense, Outside North America On- Highway and Service Parts, Support Equipment & Other segments is pegged at $65 million, $122 million and $152 million, implying an uptick of 22.6%, 9% and 3%, respectively. These gains are expected to have been somewhat offset by the projected decline in revenues from the North America On-Highway unit.
Allison has an Earnings ESP of +25.84% and a Zacks Rank #3. The company is scheduled to release first-quarter results on May 4. The Zacks Consensus Estimate for ALSN’s to-be-reported quarter’s earnings and revenues is pegged at $2.54 per share and $1.38 billion, respectively. The EPS estimate for the first quarter has moved up by a cent in the past 30 days. Allison surpassed earnings estimates in three of the trailing four quarters and missed once.
Allison Transmission Holdings, Inc. Price and EPS Surprise
Allison Transmission Holdings, Inc. price-eps-surprise | Allison Transmission Holdings, Inc. Quote