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Superior Industries (SUP) On Track to Acquire UNIWHEELS
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Superior Industries International, Inc. (SUP - Free Report) has achieved 75% of the threshold needed to complete its tender offer for the shares of UNIWHEELS AG. This accomplishment represents a significant step in the acquisition of UNIWHEELS. The shares tendered are inclusive of the controlling interest held by UNIWHEELS Holdings (Malta) Ltd., which accounts for 61.3% of the outstanding shares. Superior Industries has no additional conditions necessary to conclude the acquisition.
The combined entity is expected to operate as a global supply leader for aluminum wheels. The subscription period expired on May 22, 2017 while the tender offer is expected to be concluded on or by May 30.
In Mar 2017, Superior Industries agreed to buy UNIWHEELS for around $715 million. The buyout is expected to improve Superior Industries’ footprint in Europe and North America.
Headquartered in Germany, UNIWHEELS is the third largest supplier of aluminum wheels to the European OEM automotive market. The company is also Europe’s leading manufacturer of aluminum wheels for the automotive aftermarket.
If the UNIWHEELS acquisition is completed, Superior Industries plans to slash its dividends to 9 cents per share from its current level of 18 cents to help deleverage.
Superior Industries’ adjusted earnings of 31 cents per share in first-quarter 2017 missed the Zacks Consensus Estimate. Including one-time acquisition related costs, earnings came in at 12 cents per share, significantly down from 56 cents recorded in first-quarter 2016. Revenues were $174.2 million in the reported quarter, lower than $186.1 million reported in the year-ago quarter. Revenues also missed the Zacks Consensus Estimate.
Superior Industries continues to expect net sales for 2017 in the range of $730–$750 million. Unit shipments in 2017 are likely to be in the range of 12−12.25 million. Superior Industries anticipates value-added sales in the band of $400–$410 million and EBITDA in the range of $97−$105 million. The projections provided by the company do not include any future impact from the acquisition of UNIWHEELS.
Price Performance
Superior Industries has underperformed the Zacks categorized Auto/Truck-Original Equipment industry in the last three months. During this period, the company’s share price has decreased 18.9%, while the industry gained 3.3%. Share price primarily fell due to weak results for first-quarter 2017.
Zacks Rank & Key Picks
Superior Industries currently carries a Zacks Rank #3 (Hold).
Fiat has an expected long-term growth rate of 22.4%.
Fox Factory has an expected long-term growth rate of around 16.5%.
The expected long-term growth rate for Lear is pegged at 7.1%.
Zacks' 2017 IPO Watch List
Before looking into the stocks mentioned above, you may want to get a head start on potential tech IPOs that are popping up on Zacks' radar. Imagine being in the first wave of investors to jump on a company with almost unlimited growth potential? This Special Report gives you the current scoop on 5 that may go public at any time.
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Superior Industries (SUP) On Track to Acquire UNIWHEELS
Superior Industries International, Inc. (SUP - Free Report) has achieved 75% of the threshold needed to complete its tender offer for the shares of UNIWHEELS AG. This accomplishment represents a significant step in the acquisition of UNIWHEELS. The shares tendered are inclusive of the controlling interest held by UNIWHEELS Holdings (Malta) Ltd., which accounts for 61.3% of the outstanding shares. Superior Industries has no additional conditions necessary to conclude the acquisition.
The combined entity is expected to operate as a global supply leader for aluminum wheels. The subscription period expired on May 22, 2017 while the tender offer is expected to be concluded on or by May 30.
In Mar 2017, Superior Industries agreed to buy UNIWHEELS for around $715 million. The buyout is expected to improve Superior Industries’ footprint in Europe and North America.
Headquartered in Germany, UNIWHEELS is the third largest supplier of aluminum wheels to the European OEM automotive market. The company is also Europe’s leading manufacturer of aluminum wheels for the automotive aftermarket.
If the UNIWHEELS acquisition is completed, Superior Industries plans to slash its dividends to 9 cents per share from its current level of 18 cents to help deleverage.
Superior Industries’ adjusted earnings of 31 cents per share in first-quarter 2017 missed the Zacks Consensus Estimate. Including one-time acquisition related costs, earnings came in at 12 cents per share, significantly down from 56 cents recorded in first-quarter 2016. Revenues were $174.2 million in the reported quarter, lower than $186.1 million reported in the year-ago quarter. Revenues also missed the Zacks Consensus Estimate.
Superior Industries continues to expect net sales for 2017 in the range of $730–$750 million. Unit shipments in 2017 are likely to be in the range of 12−12.25 million. Superior Industries anticipates value-added sales in the band of $400–$410 million and EBITDA in the range of $97−$105 million. The projections provided by the company do not include any future impact from the acquisition of UNIWHEELS.
Price Performance
Superior Industries has underperformed the Zacks categorized Auto/Truck-Original Equipment industry in the last three months. During this period, the company’s share price has decreased 18.9%, while the industry gained 3.3%. Share price primarily fell due to weak results for first-quarter 2017.
Zacks Rank & Key Picks
Superior Industries currently carries a Zacks Rank #3 (Hold).
Better-ranked companies in the auto space include Fiat Chrysler Automobiles N.V. , Fox Factory Holding Corp (FOXF - Free Report) and Lear Corporation (LEA - Free Report) . All the stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Fiat has an expected long-term growth rate of 22.4%.
Fox Factory has an expected long-term growth rate of around 16.5%.
The expected long-term growth rate for Lear is pegged at 7.1%.
Zacks' 2017 IPO Watch List
Before looking into the stocks mentioned above, you may want to get a head start on potential tech IPOs that are popping up on Zacks' radar. Imagine being in the first wave of investors to jump on a company with almost unlimited growth potential? This Special Report gives you the current scoop on 5 that may go public at any time.
One has driven from 0 to a $68 billion valuation in 8 years. Four others are a little less obvious but already show jaw-dropping growth. Download this IPO Watch List today for free >>