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Auto Stock Roundup: Honda, General Motors, AutoNation & Tesla Beat on Earnings
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The past week saw a flurry of earnings reports from the auto sector along with the release of January sales figures. General Motors Company (GM - Free Report) and Toyota Motor Corporation (TM - Free Report) reported an increase in January sales, whereas Ford Motor Company (F - Free Report) and Fiat Chrysler Automobiles N.V. reported year-over-year sales decline.
Major automakers expect 2018 auto sales to remain weak. Keeping up with consumers’ rapidly changing preference from passenger cars to pickup trucks and SUVs is likely to pose a serious challenge for automakers.
However, robust economic growth, better employment prospects and rising consumer confidence are likely to boost auto demand. Also, the tax cuts should prove to be beneficial for the companies.
1. Honda Motor Co., Ltd. (HMC - Free Report) reported consolidated income of ¥570.2 billion or ¥318.50 per share ($2.82 per ADR) in the third quarter of fiscal 2018 (ended Dec 31, 2017), up ¥224.83 from the year-ago period. The Zacks Consensus Estimate for earnings per share was pegged at 78 cents.
Consolidated sales revenues increased 13% year over year to ¥3.96 trillion ($35.06 billion). The figure surpassed the Zacks Consensus Estimate of $33.1 billion. The year-over-year increase can be attributed to higher revenues in all business operations.
Consolidated operating profit came in at ¥284.5 billion, reflecting an increase of 37% from the prior-year quarter. The upside was due to an increase in sales volume and model mix, which was offset by a rise in selling, general and administrative (SG&A) expenses (read more: Honda's Q3 Earnings Rise Y/Y, Revenues Beat Estimates).
2. AutoNation Inc. (AN - Free Report) reported adjusted earnings of $1.02 per share for fourth-quarter fiscal 2017, surpassing the Zacks Consensus Estimate of 92 cents. Earnings from continuing operations came in at $1.64.
Net income from continuing operations increased to $152 million from $116 million in fourth-quarter fiscal 2016.
During the quarter, AutoNation reported revenues of $5.69 billion, rising 3.7% year over year. Also, the top line beat the Zacks Consensus Estimate of $5.56 billion.
New vehicle revenues increased 4.9% year over year to $3.35 billion in fourth-quarter fiscal 2017. However, used vehicle revenues declined 0.8% year over year to $1.21 billion. Parts and service business revenues grew 3.8% year over year to $854 million in fourth-quarter fiscal 2017. Finance and insurance business revenues came in at $247 million, reflecting a 14.2% increase (read more: AutoNation Q4 Earnings & Revenues Surpass Estimates).
AutoNation sports a Zacks Rank #1.
3. General Motors reported fourth-quarter 2017 adjusted earnings per share of $1.65, up 21.3% from the prior-year quarter. The bottom line comfortably beat the Zacks Consensus Estimate of $1.34.
General Motors reported revenues of $37.7 billion, reflecting a decline of 5.5% from the year-ago quarter. However, revenues surpassed the Zacks Consensus Estimate of $33.3 billion.
For any fourth quarter, adjusted EBIT set a record. This was aided by sales of crossovers, strong pricing and cost-control initiatives, which were partly offset by wholesale volume decline.
For full-year 2017, adjusted earnings came in at $6.62 per share, up 8.2% from the prior-year quarter. Revenues were $145.6 billion during the year, down 2.4% from 2016.
During the quarter, total wholesale unit sales declined to 1.24 million vehicles from 1.41 million in the fourth quarter of 2016. Worldwide retail unit sales decreased to 2.59 million vehicles from 2.85 million in the year-ago quarter. The automaker’s global market share was 10.3% during the reported quarter, reflecting a decline from 11.4% in the year-ago quarter (read more: General Motors' Q4 Earnings, Revenues Beat Estimates).
General Motors has a Zacks Rank #3.
4. Toyota’s operating income soared 54% to ¥673.6 billion ($5.96 billion) in third-quarter fiscal 2018 (ended Dec 31, 2017). Also, the Japanese automaker reported net income of ¥970.7 billion ($8.6 billion) in the quarter compared with ¥506.8 billion ($4.7 billion) in the prior-year quarter.
Net revenues increased 7.4% year over year to ¥7.61 trillion ($67.3 billion) in the quarter. The Zacks Consensus Estimate for revenues was $65.11 billion.
The Automotive segment’s net revenues rose to ¥6.86 trillion ($60.7 billion) in the reported quarter from ¥6.45 trillion ($59.2 billion) in the year-ago quarter while operating income increased to ¥569 billion ($5.1 billion) from the year-ago figure of ¥382.7 billion ($3.5 billion) (read more: Toyota Q3 Operating Income Surges 54%, Revenues Rise).
Toyota has a Zacks Rank #3.
5. Tesla, Inc. (TSLA - Free Report) incurred an adjusted loss of $3.04 per share in fourth-quarter 2017, narrower than the Zacks Consensus Estimate of a loss of $3.19. The company had reported a loss of 69 cents per share in the prior-year quarter.
The reported net loss in the quarter was $675.4 million compared with the year-ago net loss of $121.3 million.
Revenues increased to $3.29 billion from $2.28 billion registered in fourth-quarter 2016. The figure came in lower than the Zacks Consensus Estimate of $3.30 billion.
In 2017, Tesla incurred adjusted loss of $8.66 per share, wider than $2.87 per share in 2016. Revenues came in at $11.76 billion, higher than $7 billion in 2016.
In fourth-quarter 2017, Tesla delivered 29,967 vehicles. The combined sales of Model S and Model X grew 28% from the year-ago quarter to 28,425. During the quarter, 1,542 Model 3 vehicles were delivered.
Tesla has a Zacks Rank #3.
Performance
Last week, the maximum decline was reported by Advance Auto Parts. The only stock to register price increase was Honda. General Motors and Harley-Davidson (HOG - Free Report) shares remained flat.
In the last six months, the maximum rise was witnessed by AutoZone while Tesla shares declined the most.
Company
Last Week
Last 6 Months
GM
0.0%
19.7%
F
-1.9%
-1.2%
TSLA
-2.6%
-5.6%
TM
-0.8%
19.9%
HMC
1.1%
27.1%
HOG
0.0%
1.4%
AAP
-6.0%
0.5%
AZ0
-4.8%
37.2%
What’s Next in the Auto Space?
Watch out for the earnings releases and other developments in the sector in the coming days.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
Auto Stock Roundup: Honda, General Motors, AutoNation & Tesla Beat on Earnings
The past week saw a flurry of earnings reports from the auto sector along with the release of January sales figures. General Motors Company (GM - Free Report) and Toyota Motor Corporation (TM - Free Report) reported an increase in January sales, whereas Ford Motor Company (F - Free Report) and Fiat Chrysler Automobiles N.V. reported year-over-year sales decline.
Major automakers expect 2018 auto sales to remain weak. Keeping up with consumers’ rapidly changing preference from passenger cars to pickup trucks and SUVs is likely to pose a serious challenge for automakers.
However, robust economic growth, better employment prospects and rising consumer confidence are likely to boost auto demand. Also, the tax cuts should prove to be beneficial for the companies.
(Read the previous roundup here: Auto Stock Roundup for Feb 1, 2018)
Recap of the Week’s Most Important Stories
1. Honda Motor Co., Ltd. (HMC - Free Report) reported consolidated income of ¥570.2 billion or ¥318.50 per share ($2.82 per ADR) in the third quarter of fiscal 2018 (ended Dec 31, 2017), up ¥224.83 from the year-ago period. The Zacks Consensus Estimate for earnings per share was pegged at 78 cents.
Consolidated sales revenues increased 13% year over year to ¥3.96 trillion ($35.06 billion). The figure surpassed the Zacks Consensus Estimate of $33.1 billion. The year-over-year increase can be attributed to higher revenues in all business operations.
Consolidated operating profit came in at ¥284.5 billion, reflecting an increase of 37% from the prior-year quarter. The upside was due to an increase in sales volume and model mix, which was offset by a rise in selling, general and administrative (SG&A) expenses (read more: Honda's Q3 Earnings Rise Y/Y, Revenues Beat Estimates).
Honda has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
2. AutoNation Inc. (AN - Free Report) reported adjusted earnings of $1.02 per share for fourth-quarter fiscal 2017, surpassing the Zacks Consensus Estimate of 92 cents. Earnings from continuing operations came in at $1.64.
Net income from continuing operations increased to $152 million from $116 million in fourth-quarter fiscal 2016.
During the quarter, AutoNation reported revenues of $5.69 billion, rising 3.7% year over year. Also, the top line beat the Zacks Consensus Estimate of $5.56 billion.
New vehicle revenues increased 4.9% year over year to $3.35 billion in fourth-quarter fiscal 2017. However, used vehicle revenues declined 0.8% year over year to $1.21 billion. Parts and service business revenues grew 3.8% year over year to $854 million in fourth-quarter fiscal 2017. Finance and insurance business revenues came in at $247 million, reflecting a 14.2% increase (read more: AutoNation Q4 Earnings & Revenues Surpass Estimates).
AutoNation sports a Zacks Rank #1.
3. General Motors reported fourth-quarter 2017 adjusted earnings per share of $1.65, up 21.3% from the prior-year quarter. The bottom line comfortably beat the Zacks Consensus Estimate of $1.34.
General Motors reported revenues of $37.7 billion, reflecting a decline of 5.5% from the year-ago quarter. However, revenues surpassed the Zacks Consensus Estimate of $33.3 billion.
For any fourth quarter, adjusted EBIT set a record. This was aided by sales of crossovers, strong pricing and cost-control initiatives, which were partly offset by wholesale volume decline.
For full-year 2017, adjusted earnings came in at $6.62 per share, up 8.2% from the prior-year quarter. Revenues were $145.6 billion during the year, down 2.4% from 2016.
During the quarter, total wholesale unit sales declined to 1.24 million vehicles from 1.41 million in the fourth quarter of 2016. Worldwide retail unit sales decreased to 2.59 million vehicles from 2.85 million in the year-ago quarter. The automaker’s global market share was 10.3% during the reported quarter, reflecting a decline from 11.4% in the year-ago quarter (read more: General Motors' Q4 Earnings, Revenues Beat Estimates).
General Motors has a Zacks Rank #3.
4. Toyota’s operating income soared 54% to ¥673.6 billion ($5.96 billion) in third-quarter fiscal 2018 (ended Dec 31, 2017). Also, the Japanese automaker reported net income of ¥970.7 billion ($8.6 billion) in the quarter compared with ¥506.8 billion ($4.7 billion) in the prior-year quarter.
Net revenues increased 7.4% year over year to ¥7.61 trillion ($67.3 billion) in the quarter. The Zacks Consensus Estimate for revenues was $65.11 billion.
The Automotive segment’s net revenues rose to ¥6.86 trillion ($60.7 billion) in the reported quarter from ¥6.45 trillion ($59.2 billion) in the year-ago quarter while operating income increased to ¥569 billion ($5.1 billion) from the year-ago figure of ¥382.7 billion ($3.5 billion) (read more: Toyota Q3 Operating Income Surges 54%, Revenues Rise).
Toyota has a Zacks Rank #3.
5. Tesla, Inc. (TSLA - Free Report) incurred an adjusted loss of $3.04 per share in fourth-quarter 2017, narrower than the Zacks Consensus Estimate of a loss of $3.19. The company had reported a loss of 69 cents per share in the prior-year quarter.
The reported net loss in the quarter was $675.4 million compared with the year-ago net loss of $121.3 million.
Revenues increased to $3.29 billion from $2.28 billion registered in fourth-quarter 2016. The figure came in lower than the Zacks Consensus Estimate of $3.30 billion.
In 2017, Tesla incurred adjusted loss of $8.66 per share, wider than $2.87 per share in 2016. Revenues came in at $11.76 billion, higher than $7 billion in 2016.
In fourth-quarter 2017, Tesla delivered 29,967 vehicles. The combined sales of Model S and Model X grew 28% from the year-ago quarter to 28,425. During the quarter, 1,542 Model 3 vehicles were delivered.
Tesla has a Zacks Rank #3.
Performance
Last week, the maximum decline was reported by Advance Auto Parts. The only stock to register price increase was Honda. General Motors and Harley-Davidson (HOG - Free Report) shares remained flat.
In the last six months, the maximum rise was witnessed by AutoZone while Tesla shares declined the most.
What’s Next in the Auto Space?
Watch out for the earnings releases and other developments in the sector in the coming days.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>