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Auto Stocks to Watch for Q1 Earnings on May 9: MGA, CARG, TEN

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Last week, Auto giants — American Axle & Manufacturing Holdings, Inc. (AXL - Free Report) and Cooper-Standard Holdings Inc. (CPS - Free Report) — announced their quarterly numbers. American Axle reported an earnings beat while Cooper-Standard missed estimates.

Among a number of companies, Magna International Inc. (MGA - Free Report) , CarGurus, Inc. (CARG - Free Report) and Tenneco Inc. (TEN - Free Report) are slated to release first-quarter 2019 results on May 9.

Per the latest Earnings Preview, on a year-over-year basis, first-quarter 2019 earnings for the auto sector are expected to rise 3.1% while revenues are likely to decline 1.6%.

In first-quarter 2019, rise in employment rate, sturdy consumer confidence, and rise in income and wages for some companies are likely to have boosted auto demand. Most automakers witnessed increasing demand for larger and comfortable pickup trucks, sports utility vehicles (SUVs) and crossovers. However, this increase was partially offset by a continuous decline in demand for traditional passenger cars.

Further, ongoing trade and tariff disputes, rising interest rates, auto recalls and higher vehicle prices are likely to hamper auto sector sales.

That said, let’s take a look at the four auto companies, which are scheduled to announce their results tomorrow.

Per the proven Zacks quantitative model, chances of a positive surprise are as high as 70% for stocks with the combination of a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP.

Per our proprietary methodology, Earnings ESP shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Headquartered in Aurora, Canada, Magna designs, develops and manufactures automotive systems, assemblies, modules and components apart from engineering and assembling complete vehicles primarily for sale to original equipment manufacturers (OEMs) of cars and light trucks. In the last reported quarter, the company pulled off a positive surprise. Further, it surpassed estimates in three of the trailing four quarters, the average beat being 3.8%.

Magna has a long-term earnings growth rate of 6%. Our proven model does not conclusively predict an earnings beat for Magna in first-quarter 2019. This is because it has an Earnings ESP of 0.00% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Magna International Inc. Price and EPS Surprise

 

Magna International Inc. Price and EPS Surprise | Magna International Inc. Quote

Cambridge-based CarGurus is an online automotive marketplace, connecting buyers and sellers of new and used cars. In the last reported quarter, the company pulled off a positive surprise. Further, it surpassed estimates in all the trailing four quarters, the average beat being 91.8%.

CarGurus has a long-term earnings growth rate of 5%. Our proven model does not conclusively predict an earnings beat for the company in first-quarter 2019. This is because it has an Earnings ESP of 0.00% and a Zacks Rank #3.

CarGurus, Inc. Price and EPS Surprise

 

CarGurus, Inc. Price and EPS Surprise | CarGurus, Inc. Quote

Lake Forest, IL-based Tenneco is a leading designer, manufacturer and supplier of clean air products and systems, and ride performance for automotive and specialty vehicle applications for a diversified market that includes light vehicle, commercial truck, off-highway equipment and the aftermarket. In the last reported quarter, the company pulled off a negative surprise. Further, it missed estimates in three of the trailing four quarters, the average miss being 1.6%.

Tenneco has a long-term earnings growth rate of 8%. Our proven model does not conclusively predict an earnings beat for CarGurus in first-quarter 2019. This is because it has an Earnings ESP of 0.00% and a Zacks Rank #5 (Strong Sell).

Tenneco Inc. Price and EPS Surprise

 

Tenneco Inc. Price and EPS Surprise | Tenneco Inc. Quote

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