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The Zacks Analyst Blog Highlights: Ford Motor, Fiat Chrysler Automobiles, Navistar International, Thor Industries and General Motors

Zacks Equity Research
Updated
Vanda (VNDA) shares have started gaining and might continue moving higher in the near term, as indicated by solid earnings estimate revisions.

For Immediate Release

Chicago, IL – June 8, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Ford Motor Company F, Fiat Chrysler Automobiles N.V. FCAU, Navistar International Corp. NAV, Thor Industries, Inc. THO and General Motors Co. GM.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Thursday’s Analyst Blog:

Auto Stock Roundup: GM, FCAU, Self-Driving & EVs

The past week witnessed automakers releasing their U.S. auto sales report for May 2018. In May, vehicle sales in the United States increased by an estimated 2%. Low unemployment and robust consumer confidence reduced the impact of rising interest rates and fuel prices, and resulted in the rise in auto sales. Robust Memorial Day weekend sales also boosted retail auto deliveries.

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Automakers reported mixed US sales results for May. Ford Motor Company’s sales increased 0.7% to 242,824 units. Moreover, Fiat Chrysler Automobiles N.V.’s U.S. sales climbed 11% to 214,294 units. Among the Japanese automakers, sales of Honda Motor Co., Ltd. rose 3.1% while Toyota Motor Corp. and Nissan Motor Co., Ltd. declined 1.3% and 4.1%, respectively.

Also, the week saw Navistar International Corp. and Thor Industries, Inc. coming out their earnings results. While Navistar reported an earnings beat, Thor came out with an earnings miss.

(Read the previous roundup here: Auto Stock Roundup for May 31, 2018)

Recap of the Week’s Most Important Stories

1.    General Motors Co. has announced that Tokyo, Japan-based SoftBank Group Corp will invest $2.25 billion in GM Cruise Holdings LLC, the autonomous-vehicle unit of the carmaker. This is one of the biggest investments in the self-driving car front. This investment, made through SoftBank’s $100-billion Vision Fund, will enable the auto giant to deploy self-driving vehicles in a big way.

However, General Motors views electric and autonomous vehicles as the basis of future transport. The automaker is aiming to roll out self-driving vehicles since its $1-billion acquisition of the startup, Cruise Automation, in early 2016. Presently, General Motors holds a sizable stake in Uber’s rival Lyft.

The company believes that General Motors and SoftBank Vision Fund investments are expected to provide the capital that is required for the commercialization of autonomous vehicles, starting in 2019. (Read more: General Motors’ Self-Driving Unit Gets SoftBank Funding)

General Motors currently carries a Zacks Rank #2 (Buy).

2.    Fiat Chrysler has outlined a five-year strategy to develop more electric vehicles (EVs) by investing in future technologies while boosting sales of SUVs (sports utility vehicles) and trucks, per the Associated Press. This strategy will help the company design a product portfolio that is better-suited to meet consumer demand across all markets.

Under Fiat’s plan through 2022, it will invest €9 billion ($10.5 billion) to develop electric engines and expand offerings of EVs. Also, roughly 15% of the company’s planned €45 billion spending will be used for its combustion engine technology. Fiat’s core brands that use combustion engines are Jeep SUVs, Ram pickups, and Alfa Romeo and Maserati luxury cars.

The company anticipates these brands to contribute roughly 80% of total revenues in 2022 compared with the current contribution of 65%. The company aims to double its operating profit to €16 billion ($18.71 billion) at the end of its five-year strategy.

Further, all the new models under Jeep, Maserati and Alfa Romeo brands, to be launched in the next five years, will also have some version of electrified powertrains while the truck brand, Ram will have alternative powertrain for high-end premium trucks only. (Read more: Fiat Chrysler Reveals 5-Year Plan of EV & Brand Development)

Fiat Chrysler currently carries a Zacks Rank #3 (Hold).

3.    Navistar reported second-quarter fiscal 2018 (ended Apr 30, 2018) earnings per share of 55 cents, beating the Zacks Consensus Estimate of 28 cents. In the prior-year quarter, net loss per share was 86 cents.

Navistar recorded net income of $55 million compared with the net loss of $80 million in the prior-year quarter.

Navistar’s revenues increased 16% year over year to $2.42 billion in the reported quarter. However, revenues missed the Zacks Consensus Estimate of $2.47 billion. This year-over-year improvement was primarily driven by an increase in sales volume of the company’s Class 6-8 vehicles in the United States as well as Canada. (Read more: Navistar’s Q2 Earnings Beat Estimates, Revenues Miss)

Navistar International currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

4.    Thor Industries reported third-quarter fiscal 2018 (ended Apr 30, 2018) adjusted earnings of $2.53 per share, missing the Zacks Consensus Estimate of $2.65. However, adjusted earnings increased almost 20% from the year-ago figure of $2.11. Net income rose to $133.8 million from $111.3 million in the prior-year quarter.

Revenues rose 11.7% year over year to $2.25 billion and outpaced the Zacks Consensus Estimate of $2.2 billion.

Gross profit increased 7.8% to $316.7 million from $294 million in third-quarter fiscal 2017. The gross profit margin decreased to 14.1% compared with 14.6% in the year-ago quarter, due to increased costs, primarily associated with extended warranty expenses on certain products and slightly higher labor as well as material costs. (Read more: Thor Industries Q3 Earnings Miss Estimates, Rise Y/Y)

Thor Industries currently has a Zacks Rank #3.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1 Stock of the Day pick for free.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


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Ford Motor Company (F) : Free Stock Analysis Report
 
General Motors Company (GM) : Free Stock Analysis Report
 
Fiat Chrysler Automobiles N.V. (FCAU) : Free Stock Analysis Report
 
Navistar International Corporation (NAV) : Free Stock Analysis Report
 
Thor Industries, Inc. (THO) : Free Stock Analysis Report
 
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