Auto Stock Roundup: Volkswagen Beats Toyota Global Sales; Ford, GM Report Earnings - Analyst Blog

The second-quarter earnings season is in full swing and the headlines over the last week speak mostly of that. One major deviation from this trend was the news that Volkswagen AG VLKAY outperformed Toyota Motor Corp. TM in vehicle sales globally, in the first half of 2015.

Coming back to the earnings releases, General Motors Co. GM, Ford Motor Co. F, Penske Automotive Group, Inc. PAG and Lear Corp. LEA reported financial results over the week. All four companies reported a year-over-year increase in earnings and managed to surpass their respective Zacks Consensus Estimate. The revenue figures were mixed as General Motors and Lear Corp. missed estimates, while Ford and Penske Automotive surpassed.

(Read last week’s recap here: Auto Stock Roundup for Jul 23, 2015)

Recap of the Week’s Most Important Stories

1. Volkswagen has officially overtaken Toyota as the world’s largest automaker. The German auto giant sold 5.04 million vehicles in the first half of 2015, beating Toyota’s 5.02 million in the same time frame. Volkswagen’s success came after it captured the top spot in the world’s largest vehicle market, China (read more: Volkswagen Overtakes Toyota as World's Largest Carmaker).

2. General Motors recorded adjusted earnings of $2.2 billion or $1.29 per share in the second quarter of 2015, beating the Zacks Consensus Estimate of $1.08. In comparison, the company had generated earnings of $1.5 billion or 58 cents per share in the second quarter of 2014. The company recorded solid year-over-year improvement in results, based on strong margins in North America and better performance in China.

Revenues declined 3.5% year over year to $38.2 billion and missed the Zacks Consensus Estimate of $40.1 billion. The year-over-year decline in revenues stemmed from the adverse impact of foreign currency (read more: GM Tops Q2 Earnings on North America Strength).

3. Ford posted adjusted earnings per share of 47 cents in the second quarter of 2015, higher than 40 cents earned in the second quarter of 2014 (all excluding special items). Moreover, earnings surpassed the Zacks Consensus Estimate of 35 cents by a wide margin. Revenues in the reported quarter dropped 0.3% year over year to $37.3 billion. However, the figure surpassed the Zacks Consensus Estimate of $35.93 billion.

Ford’s profit in North America was an all-time quarterly high, while that in the Asia-Pacific was a second-quarter record. Ford reaffirmed its 2015 pre-tax profit guidance, excluding special items, in the range of $8.5–$9.5 billion (read more: Ford's Q2 Earnings Surpass Estimates, Improve Y/Y).

4. Penske Automotive’s second-quarter 2015 earnings per share improved 18% to $1.05 from 89 cents a year ago. Earnings also surpassed the Zacks Consensus Estimate of 99 cents. Net income from continuing operations rose 17.3% to $94.4 million from $80.5 million a year ago. Revenues grew 12.2% year over year to $4.90 billion, marginally surpassing the Zacks Consensus Estimate of $4.89 billion.

5. Lear Corp. posted adjusted earnings per share of $2.82 in the second quarter of 2015, up 33% from $2.12 in the year-ago quarter. Moreover, earnings beat the Zacks Consensus Estimate of $2.47. Revenues increased 1% year over year to $4.6 billion in the reported quarter but missed the Zacks Consensus Estimate of $4.74 billion.

For 2015, Lear Corp. reaffirmed the revenue guidance at $18–$18.5 billion. Adjusted net earnings are forecast at $760– $795 million, up from the prior range of $720–$755 million for the year.

Performance

Most auto stocks recorded gains over the last one-week period. Ford was leading the list of gainers, driven by better-than-expected earnings. Meanwhile, Tesla Motors, Inc. TSLA lost the maximum over the week despite being the top gainer in the six-month period. Harley-Davidson was the worst performer in the last six months.

What’s Next in the Auto Space?

In the coming week, heavyweights like Honda, Toyota and Tesla will release their financial results for the second quarter of 2015.  On Aug 3, automakers will release their U.S. auto sales data for July.

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FORD MOTOR CO (F): Free Stock Analysis Report
 
PENSKE AUTO GRP (PAG): Free Stock Analysis Report
 
TOYOTA MOTOR CP (TM): Free Stock Analysis Report
 
LEAR CORPORATN (LEA): Free Stock Analysis Report
 
GENERAL MOTORS (GM): Free Stock Analysis Report
 
VOLKSWAGEN-ADR (VLKAY): Free Stock Analysis Report
 
TESLA MOTORS (TSLA): Free Stock Analysis Report
 
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