Per Reuters, Fiat Chrysler Automobiles N.V. (FCAU - Free Report) has made the announcement that it is spending over 5 billion euros ($5.7 billion) on its plants in Italy over the period between 2019 and 2021. The company will make this investment in new models and engines in order to utilize the factories in a better way as well as to boost jobs and margins.
The company intends to introduce 13 models in the next three years and is going to take necessary actions so that all plants in Italy operate at the full capacity. This latest move is in sync with the strategy outlined by Fiat Chrysler earlier when it committed to convert the Italian plants to produce high-margin Alfa Romeos, Jeeps and Maseratis as well as hybrid and electric vehicles. This strategy is actually aimed at raising profitability and protecting jobs.
According to the latest plan, a new Fiat 500 electric model will be produced at Fiat Chrysler’s Mirafiori plant in Turin and a mild-hybrid version of its popular Fiat Panda hatchback will be produced in Pomigliano plant in southern Italy. Melfi plant, which already produces Jeep Renegade, will also make the Jeep Compass.
Over the past year, shares of Fiat Chrysler have outperformed the industry it belongs to. Over this time frame, shares of the company have decreased 1.3%, whereas the industry declined 21.4%.
Zacks Rank & Key Picks
Currently, Fiat Chrysler carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the auto space are Allison Transmission Holdings, Inc. (ALSN - Free Report) , Fox Factory Holding Corp. (FOXF - Free Report) and AutoZone, Inc. (AZO - Free Report) . While Allison Transmission and Fox Factory currently sport a Zacks Rank #1 (Strong Buy), AutoZone carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Allison Transmission has an expected long-term growth rate of 10%. Over the past six months, shares of the company have surged 9.4%.
Fox Factory has an expected long-term growth rate of 17.9%. Over the past six months, shares of the company have risen 66.2%.
AutoZone has an expected long-term growth rate of 12.2%. Over the past six months, shares of the company have risen 26.3%.
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