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Tenneco (TEN) Earnings and Revenues Beat Estimates in Q2
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Tenneco Inc. (TEN - Free Report) reported second-quarter 2017 results, wherein adjusted earnings per share of $1.90 outpaced the Zacks Consensus Estimate of $1.80. The company’s adjusted earnings per share in the prior-year quarter were $1.75.
On a reported basis, Tenneco’s net loss in the second quarter was $2 million, whereas second-quarter 2016 net income came in at $84 million.
Revenues increased 5% year over year to $2.32 billion, surpassing the Zacks Consensus Estimate of $2.27 billion. The year-over-year improvement in the top line was aided by strong revenues at both the Clean Air and Ride Performance product lines.
Global aftermarket revenues were almost flat on a year-over-year basis. Commercial truck increased 26%, while off-highway and specialty revenues rose 8%. Meanwhile, light vehicle revenues increased 5%, owing to the company’s global platform position.
Adjusted EBIT (earnings before interest, taxes and non-controlling interests) increased to $179 million during the reported quarter. The EBIT results indicate strong light vehicle volumes, strong commercial truck growth and off-highway revenues, and timing of commodity cost recoveries and other offsets.
Segment Results
Revenues from the Clean Air division increased 4.3% to $1.6 billion during the quarter. Adjusted EBIT decreased to $126 million from $132 million in the prior-year quarter.
Revenues from the Ride Performance division rose 5.8% to $698 million. Adjusted EBIT decreased to $72 million from $75 million in the year-ago quarter.
Financial Position
Tenneco had cash and cash equivalents of $333 million as of Jun 30, 2017, down from $347 million as of Dec 31, 2016. Long-term debt was $1.49 billion as of Jun 30, 2017, compared with $1.29 billion as of Dec 31, 2016.
Share Repurchase
In second-quarter 2017, the company bought back 783,800 shares for $44 million.
Outlook
Total revenue is expected to improve about 7% year over year on a constant currency basis in third-quarter 2017. Also, the company anticipates minimal currency headwind in the third quarter.
Management believes that the organic revenue growth will be driven by Clean Air and Ride Performance content on top-selling light vehicle platforms globally, continued strong commercial truck and off-highway revenues growth, and a steady contribution from the global aftermarket.
Total revenue is also expected to improve about 6% year over year on a constant-currency basis in 2017.
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Tenneco (TEN) Earnings and Revenues Beat Estimates in Q2
Tenneco Inc. (TEN - Free Report) reported second-quarter 2017 results, wherein adjusted earnings per share of $1.90 outpaced the Zacks Consensus Estimate of $1.80. The company’s adjusted earnings per share in the prior-year quarter were $1.75.
On a reported basis, Tenneco’s net loss in the second quarter was $2 million, whereas second-quarter 2016 net income came in at $84 million.
Revenues increased 5% year over year to $2.32 billion, surpassing the Zacks Consensus Estimate of $2.27 billion. The year-over-year improvement in the top line was aided by strong revenues at both the Clean Air and Ride Performance product lines.
Global aftermarket revenues were almost flat on a year-over-year basis. Commercial truck increased 26%, while off-highway and specialty revenues rose 8%. Meanwhile, light vehicle revenues increased 5%, owing to the company’s global platform position.
Adjusted EBIT (earnings before interest, taxes and non-controlling interests) increased to $179 million during the reported quarter. The EBIT results indicate strong light vehicle volumes, strong commercial truck growth and off-highway revenues, and timing of commodity cost recoveries and other offsets.
Segment Results
Revenues from the Clean Air division increased 4.3% to $1.6 billion during the quarter. Adjusted EBIT decreased to $126 million from $132 million in the prior-year quarter.
Revenues from the Ride Performance division rose 5.8% to $698 million. Adjusted EBIT decreased to $72 million from $75 million in the year-ago quarter.
Financial Position
Tenneco had cash and cash equivalents of $333 million as of Jun 30, 2017, down from $347 million as of Dec 31, 2016. Long-term debt was $1.49 billion as of Jun 30, 2017, compared with $1.29 billion as of Dec 31, 2016.
Share Repurchase
In second-quarter 2017, the company bought back 783,800 shares for $44 million.
Outlook
Total revenue is expected to improve about 7% year over year on a constant currency basis in third-quarter 2017. Also, the company anticipates minimal currency headwind in the third quarter.
Management believes that the organic revenue growth will be driven by Clean Air and Ride Performance content on top-selling light vehicle platforms globally, continued strong commercial truck and off-highway revenues growth, and a steady contribution from the global aftermarket.
Total revenue is also expected to improve about 6% year over year on a constant-currency basis in 2017.
Zacks Rank & Key Picks
Tenneco currently carries a Zacks Rank #3 (Hold).
Some better-ranked companies in the auto space are Allison Transmission Holdings (ALSN - Free Report) , Volkswagen AG and Daimler AG , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Allison Transmission has expected long-term growth rate of 11%.
Volkswagen has expected growth rate of around 17.3% in the long run.
Daimler has expected long-term growth rate of 2.8%.
Tenneco Inc. Price, Consensus and EPS Surprise
Tenneco Inc. Price, Consensus and EPS Surprise | Tenneco Inc. Quote
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>