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Auto Stock Roundup: General Motors, PACCAR, Penske Earnings Beat, Sonic In Line

Earnings season for quarter-ended Sep 30, 2017 for the auto stocks is in full swing. Auto majors such as General Motors Company GM and PACCAR Inc PCAR have reported their third-quarter 2017 results last week. Both the companies delivered positive earnings surprises.

According to the latest Earnings Outlook, as of Oct 25, third-quarter 2017 earnings and revenue growth for auto companies are expected to be in the negative territory. Auto stocks are expected to register 9.8% and 8% year-over-year decline in earnings and revenues, respectively. However, the S&P 500 companies are expected to register 3.6% and 5% year-over-year growth in earnings and revenues, respectively.

Of late, automakers have been making phenomenal changes in their operations. The changing preference pattern of consumers has prompted a number of automakers to re-evaluate their strategies. Added to this is the compulsion of manufacturing electric and green cars, which are likely to bring in numerous changes in the industry.

Recap of the Week’s Most Important Stories

1.    Winnebago Industries Inc. WGO registered earnings of 79 cents per share in the fourth quarter. The earnings per share after adjusting amortization and non-recurring costs came in at 94 cents, comfortably beating the Zacks Consensus Estimate of 72 cents. In the year-ago quarter, earnings were 49 cents per share. Net income on a reported basis soared 89.6% to $24.9 million or 70 cents per share.

Revenues in the fourth quarter soared 72.8% to $454.9 million from $263.3 million in the prior-year quarter. The figure also outpaced the Zacks Consensus Estimate of $443 million. This upside in the top line was driven by robust growth of the Towable business (read more: Winnebago Q4 Earnings & Revenues Top Estimates, Up Y/Y).

Currently, Winnebago Industries sports a Zacks Rank #1 (Strong Buy). You can see  the complete list of today’s Zacks #1 Rank stocks here.

2.    General Motors delivered adjusted earnings of $1.32 per share in third-quarter 2017, surpassing the Zacks Consensus Estimate of $1.07. However, earnings decreased 22.8% from $1.71 per share in the third quarter of 2016.

Revenues in the reported quarter came in at $33.6 billion, 13.5% lower than the year-ago quarter. However, revenues surpassed the Zacks Consensus Estimate of $31.6 billion.

Total wholesale unit sales declined to 1.08 million vehicles from 1.34 million in the third quarter of 2016. Worldwide retail unit sales decreased to 2.32 million vehicles from 2.39 million in the year-ago quarter. The automaker’s global market share was 10% during the reported quarter, reflecting a decline from 10.6% in the year-ago quarter (read more: General Motors Q3 Earnings Beat Estimates, Fall Y/Y).

Currently, General Motors carries a Zacks Rank #3 (Hold).

3.    PACCAR reported third-quarter 2017 earnings of $1.14 per share, up from 98 cents registered in the year-ago quarter. Earnings surpassed the Zacks Consensus Estimate of $1.09. Results benefited from a strong European market, increasing market share in North America and global higher market sales.

Net sales and financial services revenues increased to $5.06 billion from $4.25 billion registered in third-quarter 2016 (read more : PACCAR  Q3 Earnings Drive Past Estimates, Grow Y/Y).

Currently, PACCAR carries a Zacks Rank #2 (Buy).

4.    Sonic Automotive Inc. SAH registered adjusted earnings per share of 40 cents in third-quarter 2017 compared with 47 cents in the year-ago quarter. However, earnings came in line with the Zacks Consensus Estimate.

Total revenues in the reported quarter decreased 2% to $2.51 billion. The figure also missed the Zacks Consensus Estimate of $2.53 billion.

Revenues from total new vehicles declined 0.9% year over year to $1.36 billion. Revenues from used vehicles decreased 0.2% to $659.7 million in the quarter. Wholesale vehicle revenues dropped 38.9% to $43.1 million. Revenues from parts, service and collision repair decreased 3.9% to $347.7 million, while finance, insurance and other revenues grew 3.7% to $92.9 million (read more: Sonic Automotive’s Q3 Earnings In Line, Down Y/Y).

Sonic Automotive currently carries a Zacks Rank #5 (Strong Sell).

5.    Penske Automotive Group Inc. PAG reported earnings of $1.10 per share in the third quarter of 2017, surpassing the Zacks Consensus Estimate of $1.07. The bottom line in the prior-year quarter was $1.03 per share.

During the quarter, income from continuing operations increased 7.9% to $94.3 million.

Revenues increased 7.2% year over year to $5.52 billion, surpassing the Zacks Consensus Estimate of $5.34 billion. Excluding foreign exchange, revenues increased 6.9%, driven by the 9.9% rise in total retail unit sales to 130,257. Same-store retail revenues declined 2.9% to 114,941 units.

Penske Automotive currently carries a Zacks Rank #3 (Hold).

Performance

CompanyLast WeekLast 6 Months
GM0.0%31.2%
F0.0%3.8%
TSLA-9.4%5.1%
TM-0.7%11.4%
HMC0.0%4.7%
HOG1.8%-15.5%
AAP-5.1%-42.9%
AZO-3.1%-17.8%


Last week, the steepest increase was registered by Harley-Davidson, Inc. HOG and the sharpest decline was witnessed by Tesla, Inc. TSLA.
In the last six months, the steepest increase and the sharpest decline too were witnessed by General Motors and Advance Auto Parts, respectively.

What’s Next in the Auto Space?

Third-quarter 2017 earnings season is in full swing. Watch out for the earnings releases of other auto companies over the next week.

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Penske Automotive Group, Inc. (PAG): Free Stock Analysis Report
 
Sonic Automotive, Inc. (SAH): Free Stock Analysis Report
 
PACCAR Inc. (PCAR): Free Stock Analysis Report
 
General Motors Company (GM): Free Stock Analysis Report
 
Tesla Inc. (TSLA): Free Stock Analysis Report
 
Winnebago Industries, Inc. (WGO): Free Stock Analysis Report
 
Harley-Davidson, Inc. (HOG): Free Stock Analysis Report
 
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