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Auto Stocks' Q2 Earnings Roster for Jul 26: BWA, LKQ & More
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The second-quarter earnings season is in full swing. Within the Auto sector, a few have already released their earnings while a majority of them will report in the next few days. On Jul 24, PACCAR Inc. (PCAR - Free Report) and Harley-Davidson Inc. (HOG - Free Report) reported an earnings beat in the second quarter.
Per the latest Earnings Preview, as of Jul 20, 87 companies under the S&P 500 category have already announced second-quarter results. These companies recorded estimate beat ratios of 86.2% and 77% in earnings and revenues, respectively.
On a year-over-year basis, the auto sector’s earnings are expected to decline 9.7% while revenues are likely to gain 3.5%. However, the S&P 500 companies are estimated to record a respective 21% and 8.3% year-over-year rise in earnings and revenues in the quarter.
In the first half of 2018, the auto sector witnessed an improvement in sales primarily on robust economic conditions driven by favorable job market scenario and tax cuts. This, along with huge discounts, offered by companies is roping in customers to invest in pickup trucks and sport utility vehicles (SUVs), leading to higher sales.
Increased demand for spacious vehicles like pickup trucks and SUVs has prompted auto manufacturers to alter their business strategies and investments to continue generating revenues. Companies are frequently launching newer and technologically-enhanced vehicle models in varied price ranges has flooded the market with a variety of options for customers to choose from. Further, automakers are gradually shifting toward electric and autonomous vehicles, which are considered the future of the auto sector. However, huge investments owing to high R&D expenses for these technological developments have prompted the companies to opt for partnerships.
Now, let’s assess a few important automakers, namely, BorgWarner Inc. (BWA - Free Report) , LKQ Corporation (LKQ - Free Report) , Lear Corporation (LEA - Free Report) , CNHI Industrial N.V. (CNHI - Free Report) and Visteon Corporation (VC - Free Report) , slated to announce their quarterly numbers on Jul 26.
We relied on the proven Zacks quantitative model, combining a favorable Zacks Rank #1 (Strong Buy) or 2 (Buy) or 3 (Hold) with a positive Earnings ESP, to predict the chances of an earnings beat this quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Per our proprietary methodology, Earnings ESP shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate. Our research shows that with an ideal combination of the two key ingredients — Zacks Rank and Earnings ESP — chances of a positive surprise are as high as 70% for the stocks lined up for an earnings release.
Michigan-based BorgWarner is one the leading manufacturers of powertrain products for major automakers. Its products cater light, medium and heavy-duty vehicles. Last quarter, the company outpaced the Zacks Consensus Estimate. Additionally, the company delivered a positive earnings surprise in all the trailing four quarters. Further, it has a long-term earnings growth rate of 8%.
Per our model, BorgWarner is likely to beat on earnings this quarter as the company has an Earnings ESP of +0.03% and a Zacks Rank #3.
Chicago, IL-based LKQ Corporation is a provider of alternative and specialty parts to repair and accessorize vehicles. Last quarter, the company reported an earning miss. Further, in the last four quarters, it exceeded estimates twice and missed the same with an average miss of 0.03%.
The company has a long-term growth rate of 15%. Per our model, it seems that LKQ is likely to beat on earnings this quarter as the company has an Earnings ESP of +1.56% and a Zacks Rank #1. (Read more: LKQ Corporation's Q2 Earnings: Is a Beat in Store?)
Southfield, MI-based Lear is a provider of automotive seating and electrical systems (E-Systems). Its primary customers consist of automotive original equipment manufacturers (OEMs). In the last reported quarter, the company delivered a positive earnings surprise of 3.9%. In fact, the company has surpassed earnings estimates in the trailing four quarters, recording an average beat of 4.2%.
Our proven model does not conclusively predict an earnings beat for the company. This is because it has an Earnings ESP of 0.00% and a Zacks Rank of 3. (Read more: What's in the Cards for Lear This Earnings Season?)
CNH Industrial offers vehicles for agricultural and industrial purposes. Its products range from tractors to trucks and buses as well as powertrain solutions for off and on-road, and marine vehicles. Last quarter, the company posted an earning beat. Further, in the last four quarters, it exceeded estimates thrice while meeting once, with an average beat of 32.8%.
Our proven model does not conclusively predict an earnings beat for CNH Industrial. This is because it has an Earnings ESP of +2.31% and a Zacks Rank #5 (Strong Sell).
Visteon engages in design, engineering and manufacturing of automotive systems and components for vehicle manufacturers. It products include climate systems, powertrain control systems, engine induction systems and cockpit modules, among others. In the last reported quarter, the company delivered a positive earnings surprise of 17.5%. Further, in the last four quarters, it exceeded estimates thrice and missed in one with an average beat of 9.3%.
Visteon has a long-term growth rate of 15%. Per our model, it seems that the company is likely to beat on earnings this quarter as it has an Earnings ESP of +6.55% and a Zacks Rank of 3.
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
Auto Stocks' Q2 Earnings Roster for Jul 26: BWA, LKQ & More
The second-quarter earnings season is in full swing. Within the Auto sector, a few have already released their earnings while a majority of them will report in the next few days. On Jul 24, PACCAR Inc. (PCAR - Free Report) and Harley-Davidson Inc. (HOG - Free Report) reported an earnings beat in the second quarter.
Per the latest Earnings Preview, as of Jul 20, 87 companies under the S&P 500 category have already announced second-quarter results. These companies recorded estimate beat ratios of 86.2% and 77% in earnings and revenues, respectively.
On a year-over-year basis, the auto sector’s earnings are expected to decline 9.7% while revenues are likely to gain 3.5%. However, the S&P 500 companies are estimated to record a respective 21% and 8.3% year-over-year rise in earnings and revenues in the quarter.
In the first half of 2018, the auto sector witnessed an improvement in sales primarily on robust economic conditions driven by favorable job market scenario and tax cuts. This, along with huge discounts, offered by companies is roping in customers to invest in pickup trucks and sport utility vehicles (SUVs), leading to higher sales.
Increased demand for spacious vehicles like pickup trucks and SUVs has prompted auto manufacturers to alter their business strategies and investments to continue generating revenues. Companies are frequently launching newer and technologically-enhanced vehicle models in varied price ranges has flooded the market with a variety of options for customers to choose from. Further, automakers are gradually shifting toward electric and autonomous vehicles, which are considered the future of the auto sector. However, huge investments owing to high R&D expenses for these technological developments have prompted the companies to opt for partnerships.
Now, let’s assess a few important automakers, namely, BorgWarner Inc. (BWA - Free Report) , LKQ Corporation (LKQ - Free Report) , Lear Corporation (LEA - Free Report) , CNHI Industrial N.V. (CNHI - Free Report) and Visteon Corporation (VC - Free Report) , slated to announce their quarterly numbers on Jul 26.
We relied on the proven Zacks quantitative model, combining a favorable Zacks Rank #1 (Strong Buy) or 2 (Buy) or 3 (Hold) with a positive Earnings ESP, to predict the chances of an earnings beat this quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Per our proprietary methodology, Earnings ESP shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate. Our research shows that with an ideal combination of the two key ingredients — Zacks Rank and Earnings ESP — chances of a positive surprise are as high as 70% for the stocks lined up for an earnings release.
Michigan-based BorgWarner is one the leading manufacturers of powertrain products for major automakers. Its products cater light, medium and heavy-duty vehicles. Last quarter, the company outpaced the Zacks Consensus Estimate. Additionally, the company delivered a positive earnings surprise in all the trailing four quarters. Further, it has a long-term earnings growth rate of 8%.
Per our model, BorgWarner is likely to beat on earnings this quarter as the company has an Earnings ESP of +0.03% and a Zacks Rank #3.
BorgWarner Inc. Price and EPS Surprise
BorgWarner Inc. Price and EPS Surprise | BorgWarner Inc. Quote
Chicago, IL-based LKQ Corporation is a provider of alternative and specialty parts to repair and accessorize vehicles. Last quarter, the company reported an earning miss. Further, in the last four quarters, it exceeded estimates twice and missed the same with an average miss of 0.03%.
The company has a long-term growth rate of 15%. Per our model, it seems that LKQ is likely to beat on earnings this quarter as the company has an Earnings ESP of +1.56% and a Zacks Rank #1. (Read more: LKQ Corporation's Q2 Earnings: Is a Beat in Store?)
LKQ Corporation Price and EPS Surprise
LKQ Corporation Price and EPS Surprise | LKQ Corporation Quote
Southfield, MI-based Lear is a provider of automotive seating and electrical systems (E-Systems). Its primary customers consist of automotive original equipment manufacturers (OEMs). In the last reported quarter, the company delivered a positive earnings surprise of 3.9%. In fact, the company has surpassed earnings estimates in the trailing four quarters, recording an average beat of 4.2%.
Our proven model does not conclusively predict an earnings beat for the company. This is because it has an Earnings ESP of 0.00% and a Zacks Rank of 3. (Read more: What's in the Cards for Lear This Earnings Season?)
Lear Corporation Price and EPS Surprise
Lear Corporation Price and EPS Surprise | Lear Corporation Quote
CNH Industrial offers vehicles for agricultural and industrial purposes. Its products range from tractors to trucks and buses as well as powertrain solutions for off and on-road, and marine vehicles. Last quarter, the company posted an earning beat. Further, in the last four quarters, it exceeded estimates thrice while meeting once, with an average beat of 32.8%.
Our proven model does not conclusively predict an earnings beat for CNH Industrial. This is because it has an Earnings ESP of +2.31% and a Zacks Rank #5 (Strong Sell).
CNH Industrial N.V. Price and EPS Surprise
CNH Industrial N.V. Price and EPS Surprise | CNH Industrial N.V. Quote
Visteon engages in design, engineering and manufacturing of automotive systems and components for vehicle manufacturers. It products include climate systems, powertrain control systems, engine induction systems and cockpit modules, among others. In the last reported quarter, the company delivered a positive earnings surprise of 17.5%. Further, in the last four quarters, it exceeded estimates thrice and missed in one with an average beat of 9.3%.
Visteon has a long-term growth rate of 15%. Per our model, it seems that the company is likely to beat on earnings this quarter as it has an Earnings ESP of +6.55% and a Zacks Rank of 3.
Visteon Corporation Price and EPS Surprise
Visteon Corporation Price and EPS Surprise | Visteon Corporation Quote
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>