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Aptiv PLC (APTV) Up 3% Since Last Earnings Report: Can It Continue?

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A month has gone by since the last earnings report for Aptiv PLC (APTV). Shares have added about 3% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Aptiv PLC due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Aptiv Surpasses Q4 Earnings and Revenue Estimates

Aptivreported better-than-expected fourth-quarter 2020 results. Adjusted earnings of $1.13 per share beat the Zacks Consensus Estimate by 15.3% and but declined 1.7% year over year. Revenues of $4.21 billion surpassed the consensus estimate by 10.4% and increased 17% year over year.

Other Quarterly Numbers

Signal and Power Solutions revenues of $3.1 billion were up 21% year over year. Advanced Safety and User Experience revenues increased 8% year over year to $1.1 billion. Adjusted operating income came in at $476 million, up from $388 million in the year-ago quarter. Adjusted operating income margin was 11.3%, up from 10.8% in the year-ago quarter.

Aptiv exited the quarter with cash and cash equivalents balance of $2.8 billion compared with the prior quarter’s $2.1 million. Long-term debt was $4 billion, compared with $3.9 billion in the previous quarter. Total available liquidity at the end of the quarter was $5.2 billion compared with the $4.5 billion recorded at the end of the prior quarter. Net cash generated from operating activities was $799 million.

2021 Outlook

Aptiv expects revenues in the range of $15.125 billion to $15.725 billion.  Adjusted EPS is expected between $3.35 and $3.85. Adjusted operating income is anticipated between $1.54 billion and $1.69 billion. Effective tax rate is expected to be 12%.

How Have Estimates Been Moving Since Then?

It turns out, estimates revision have trended downward during the past month. The consensus estimate has shifted -12.37% due to these changes.

VGM Scores

Currently, Aptiv PLC has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Aptiv PLC has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.


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