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Superior Industries (SUP) Posts Loss in Q4, Misses on Sales

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Superior Industries International, Inc. SUP reported adjusted fourth-quarter 2019 loss of 8 cents, narrower than the Zacks Consensus Estimate of a loss of 35 cents. The narrower-than-expected loss resulted from higher-than-expected shipments and revenues in European markets. The loss per share also narrowed 50%, year on year.

The aluminum-wheel manufacturer reported revenues of $310 million, missing the Zacks Consensus Estimate of $332 million. The top line also came in lower than the year-ago figure of $379 million. This downside resulted mainly from lower volumes, including the impact of the General Motors (GM - Free Report) strike as well as lower aluminum price.

Superior Industries International, Inc. Price, Consensus and EPS Surprise

Quarter Details

During the fourth quarter, the company’s wheel unit shipments decreased 14% year over year to 4.5 million. This downside primarily stemmed from shipment declines in North America and Europe due to lower year-over-year production, including the impact of the UAW labor strike at GM. Shipments in Europe came in at 2.3 million, down from the 2.5 million recorded in fourth-quarter 2018. In North America, the shipments were 2.18 million, lower than the year-ago figure of 2.64 million.

Sales in the European market came in at $159.6 million, lower than the $185.1 million recorded in the year-ago quarter. Sales in the North American market totaled $150.7 million, down from the prior-year period’s $193.7 million.

The company reported operating loss of $92 million as against operating profit of $19 million in the year-ago quarter. Selling, general and administrative expenses in the quarter were $17 million, flat year over year.

Net cash provided by operating activities summed $61 million in the December-end quarter, down from the year-ago quarter’s $92 million. Capital expenditure amounted to $16.7 million.

During the quarter, Superior Industries paid dividends of $3 million and purchased $3 million of shares from minority equity holders of Superior Industries Europe AG. As of Dec 31, 2019, the company’s net debt was $553 million, representing debt-to-capital ratio of 68.72%.

2020 Outlook

For full-year 2020, Superior Industries projects unit shipments of 18.4-19 million. Net sales are projected between $1.33 million and $1.39 million, and cash flow from operations is projected at $125-$145 million. Adjusted EBITDA is expected in the range of $170-$190 million and capex is expected to be around $75 million.

Zacks Rank & Stocks to Consider

Superior Industries currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Auto-Tires-Trucks sector include SPX Corporation SPXC and Adient PLC (ADNT - Free Report) , each carrying a Zacks Rank of 2 (Buy), at present. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

SPX has an expected earnings growth rate of 6.52% for 2020. The stock has rallied 23% in the past year.

Adient has an estimated earnings growth rate of 17.79% for the current year. The company’s shares have appreciated 23.4% over the past year.

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