Aptiv PLC APTV reported better-than-expected fourth-quarter 2019 results.
Adjusted earnings of $1.15 per share beat the Zacks Consensus Estimate by 12.7% but declined 14.2% year over year. Revenues of $3.6 billion surpassed the consensus mark by 1.4% but declined 1% year over year.
Shares of Aptiv have gained 23.1% in the past year, against 2.2% decline of the industry it belongs to.
Quarterly Numbers in Detail
Revenues in the Signal and Power Solutions segment totaled $2.57 billion, down 1% on a year-over-year basis and contributed 71% to total revenues. Advanced Safety and User Experience revenues of $1.03 billion were down 1% year over year and contributed 29% to total revenues.
Adjusted operating income of $388 million fell 9.8% year over year. Adjusted operating income margin declined to 10.8% from 11.5% in the prior-year quarter due to unfavorable impacts of the GM labor strike.
Aptiv exited the quarter with cash and cash equivalents balance of $412 million compared with $341 million at the end of the prior quarter. Long-term debt was $4 billion, flat with the prior quarter.
Total available liquidity at the end of the quarter was $2.4 billion compared with $2.3 billion at the end of the prior quarter. Net cash provided by operating activities was $703 million and capital expenditures were $162 million in the quarter.
During the fourth quarter, Aptiv returned $86 million to shareholders through share repurchases and dividends. The company repurchased shares for roughly $30 million and paid out $56 million in dividend payments.
The company expects adjusted earnings in the range of 86 cents to 94 cents per share, lower than the Zacks Consensus estimate of $1.24.
Net sales are anticipated between $3.47 billion and $3.57 billion, lower than the Zacks Consensus Estimate of $3.76 billion.
Adjusted operating income is expected in the range of $303-$308 million. Adjusted operating income margin is anticipated between 8.7% and 9.2%. The company expects effective tax rate between 12% and 13% for the quarter.
Adjusted earnings are expected in the range of $4.75-$5.05 per share, the midpoint of which is below the Zacks Consensus estimate of $5.4.
Net sales are anticipated between $14.5 billion and $14.9 billion, below the Zacks Consensus Estimate of $15.1 billion.
Adjusted operating income is expected in the range of $1,670-$1,770 million. Adjusted operating income margin is anticipated between 11.5% and 11.9%. The company expects capital expenditures of $750 million and adjusted effective tax rate between 12% and 13% for the year.
Zacks Rank & Stocks to Consider
Currently, Aptiv carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Business Services sector are Waste Management WM, S&P Global SPGI and Fidelity National Information Services FIS , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Long-term earnings (three to five years) growth rate for Waste Management, S&P Global and Fidelity National Information Services is estimated at 8.2%, 10% and 8.9%, respectively.
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