Several companies from the Zacks
Auto sector — including Ford Motor Company F, General Motors Company GM, Penske Automotive Group, Inc. PAG, PACCAR Inc. ( PCAR Quick Quote PCAR - Free Report) and The Goodyear Tire & Rubber Company GT — came out with first-quarter 2019 results in the past week. Among these companies, Ford, PACCAR and Goodyear reported earnings and revenue beat. While General Motors and Penske Automotive reported earnings beat, revenues for both missed estimates. Recap of the Week’s Most Important Stories 1. Ford reported first-quarter 2019 adjusted earnings per share of 44 cents, beating the Zacks Consensus Estimate of 26 cents. In the prior-year quarter, adjusted earnings were 43 cents per share. Results were impacted by the exit of heavy truck operation in South America and restructuring of the company’s joint venture in Russia, offset by robust performance in North America and at Ford Credit. Adjusted earnings before income and taxes (EBIT) in the first quarter were$2.4 billion, reflecting an increase of $0.3 billion from the year-ago quarter. During the reported quarter, Ford logged automotive revenues of $37.2 billion, surpassing the Consensus Estimate of $36.4 billion. In the prior-year quarter, the figure was $39 billion. During the reported quarter, wholesale volume at the Ford Automotive segment declined 237,000 units to 1.43 million. EBIT was $2 billion, marking a decline of $0.3 billion from the year-ago quarter. In North America, revenues increased $0.6 billion year over year to $25.4 billion during the reported quarter. Wholesale volume declined 43,000 units to 753,000. Further, EBIT was $2.2 billion, marking rise of $0.3 billion from the year-ago quarter. Thisrise was majorly due to stronger net pricing and product mix. In South America, revenues declined $0.4 billion year over year to $0.9 billion. Pre-tax loss amounted to $158 million, owing to inflationary and adverse exchange effects. Moreover, wholesale volume declined 18,000 units to 68,000. In Europe, revenues decreased $1.3 billion to $7.6 billion. Wholesale volume decreased 58,000 units to around 391,000. The region’s EBIT was $57 million, marking a decline of $62 million in the first quarter of 2018. In the Middle East & Africa segment, revenues were $0.6 billion. Further, wholesale volume declined 3,000 units to 22,000. The region recorded an EBIT of $14 million. In the Asia Pacific region, excluding China, revenues declined $0.3 billion to $1.8 billion. Wholesale volume declined 8,000 units to 76,000. Further, the region recorded an EBIT of$19 million. In China, revenues declined $0.4 billion year over year to $0.9 billion. Further, the company incurred pre-tax loss of $128 million in that country. This decline was due to lower volume, partly offset by the company’s cost-reduction actions. (Read more: Ford Earnings & Revenues Drive Past Estimates in Q1) Ford currently carries a Zacks Rank #2 (Buy).You can see . the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 2. General Motors reported adjusted earnings of $1.41 per share in first-quarter 2019, down 1.4% from the prior-year quarter. However, the bottom line surpassed the Zacks Consensus Estimate of $1.09. During the quarter, the sale of 2019 Chevrolet Silverado and GMC Sierra light-duty crew cabs grew 20% year over year. This is in sync with the automaker’s strategy to launch high-content, high-margin trucks. General Motors reported revenues of $34.9 billion, down3.4% from the year-ago quarter. Further, revenues missed the Zacks Consensus Estimate of $35.8 billion. During the reported quarter, total sales for the wholesale unit decreased to 1.10 million from 1.16 million in the first quarter of 2018. Worldwide retail units sold decreased to 1.88 million from 2.10 million in the year-ago quarter. This automaker’s global market share was 10.6% during the reported quarter, reflecting a decline from 11.4% in the year-ago quarter. GM North America (“GMNA”) generated net sales and revenues of $27.4 billion in the first quarter of 2019, down from $27.8 billion recorded in first-quarter 2018. GM International’s (“GMI”) net sales and revenues were $3.9 billion, declining from $4.8 billion in the year-ago quarter. GM Financial generated net sales and revenues of $3.6 billion in the quarter under review, reflecting an increase from $3.4 billion recorded in the year-ago quarter. (Read more: General Motors Q1 Earnings Beat, Revenues Miss Estimates) General Motors currently carries a Zacks Rank #3 (Hold). 3. Penske Automotive reported first-quarter 2019 adjusted earnings of $1.25 per share, which beat the Zacks Consensus Estimate of $1.24. During the reported quarter, income from continuing operations attributable to common shares was $100.1 million compared with $108 million a year ago. Total revenues declined 3.2% year over year to $5.56 billion, which missed the Zacks Consensus Estimate of $5.73 billion. Same-store retail unit sale decreased 3.8% year over year to 124,725. Within the retail automotive segment, new-vehicle revenues declined 8.8% year over year to $2.2 billion while used-vehicle revenues fell 0.8% to $1.9 billion. The company’s gross profit decreased to $851.5 million from $864.4 million in the prior-year quarter. During the quarter under review, operating income declined 9.7% to $158.7 million. The company operates under three segments namely — Retail Automotive, Retail Commercial Trucks, and Commercial Vehicles Australia/Power Systems and Other. Revenues from Retail Automotive decreased to $5.09 billion from $5.30 billion in the year-ago quarter. Revenues from Retail Commercial Trucks increased to $332.3 million from $292.4 million in the year-ago quarter. In the reported quarter, revenues from Commercial Vehicles Australia/Power Systems and Other declined to $140.9 million from $158.5 million a year ago. (Read more: Penske Automotive Earnings Surpass Estimates in Q1) Penske Automotive currently carries a Zacks Rank #3. 4.PACCAR first-quarter 2019 earnings were $1.81 per share, surpassing the Zacks Consensus Estimate of $1.66. Results were aided by a record truck delivery and strong global truck demand. In first-quarter 2018, its earnings per share were $1.45. The company posted quarterly consolidated net sales and revenues of $6.14 billion, up from the prior-year quarter figure of $5.32 billion. The Zacks Consensus Estimate for revenues was pegged at $6 billion. The pre-tax revenues from the Truck, Parts and Other segment increased to $716.1 million from $591.9 million recorded a year ago. Revenues from the Financial Services segment rose to $349.5 million from $332.2 million a year ago. Pre-tax income increased to $84 million from $67.5 million in the year-ago quarter. (Read more: PACCAR Earnings & Revenues Surpass Estimates in Q1) PACCAR currently carries a Zacks Rank #2. 5. Goodyear reported adjusted earnings per share of 19 cents in first-quarter 2019 compared with 50 cents in the prior-year quarter. The bottom line surpassed the Zack Consensus Estimate of 5 cents. It reported net loss of $44 million against net income of $80 million in the year-ago quarter. The company delivered net revenues of $3.60 billion, lower than $3.83 billion in the year-ago quarter. Also, the top line beat the Zacks Consensus Estimate of $3.54 billion. The year-over-year decline in revenues was due to currency fluctuations as well as lower volume in international businesses. These effects were partly offset by improvements in price/mix. During the reported quarter, tire unit volume was 38 million, down3% from the year-ago quarter. Replacement tire shipments were down less than 1% from the year-ago quarter. Segment operating income was $89 million, down 30% year over year. Revenues in the Americas’ segment declined year over year from $1.93 billion to $1.88 billion. The segment’s operating income was $89 million, down from $127 million in first-quarter 2018. Revenues at the Europe, Middle East and Africa segment were $1.22 billion, down 8% year over year. The segment’s operating income decreased 31% to $54 million. Revenues at the Asia Pacific segment declined 12% to $501 million. The segment’s operating income declined year over year to $47 million from $76 million. (Read more: Goodyear Q1 Earnings Surpass Estimates, Decrease Y/Y) Goodyear Tire currently carries a Zacks Rank #3. Performance Last week, among all these stocks, Ford gained the maximum while Tesla, Inc. TSLA declined the most. In the last six months, while Tesla declined the most, AutoZone, Inc. AZO gained the maximum.
Company Last Week Last 6 Months GM -2.4% 6.9% F 7.6% 8.1% TSLA -9.5% -31.5% TM 0.0% 6.5% HMC 0.2% -3% HOG -3.4% -6.9% AAP -4.7% -0.8% AZO -1.8% 33.6%
What’s Next in the Auto Space? Watch out for the usual news releases and the earnings releases over the next week. Zacks' Top 10 Stocks for 2019 In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-holds for the year? Who wouldn't? Our annual Top 10s have beaten the market with amazing regularity. In 2018, while the market dropped -5.2%, the portfolio scored well into double-digits overall with individual stocks rising as high as +61.5%. And from 2012-2017, while the market boomed +126.3, Zacks' Top 10s reached an even more sensational +181.9%. See Latest Stocks Today >>