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Auto Stock Roundup: AZO & THO Q1 Earnings, TSLA & NIO Stock Offerings

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Rimmi Singhi
·4 min read
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Last week, China Association of Automobile Manufacturers (“CAAM”) unveiled vehicle sales data for the month of November. Per CAAM, auto sales for the month climbed 12.6% year on year to 2.77 million units and sales of new energy vehicles (NEVs) surged 104.9% to 200,000 units. NEVs include battery-powered electric, plug-in petrol-electric hybrids and hydrogen fuel-cell vehicles. Sales for November increased for the eighth straight month in a row, while NEV sales in the country witnessed the fifth consecutive month of growth.However, sales from January through November for the world’s biggest auto market are still down from 2019. China car sales witnessed a decline of 2.9% from January through November compared with the corresponding period of 2019.

(Read the Last Auto Stock Roundup here).

Recap of the Week’s Most Important Stories

AutoZone, Inc. AZO reported earnings of $18.61 per share for first-quarter fiscal 2021 (ended Nov 21, 2020), up from the prior-year figure of $14.3. The bottom line also surpassed the Zacks Consensus Estimate of $17.72. Net sales also increased 12.9% year over year to $3,154.3 million. The top line, however, marginally missed the Zacks Consensus Estimate of $3,164 million. At quarter-end, AutoZone had cash and cash equivalents of $1,664 million, and total debt of $5,514.9 million. Total store count was 6,590 as of Nov 21, 2020.

Thor Industries, Inc. THO reported first-quarter fiscal 2021 (ended Oct 31, 2020) adjusted earnings of $2.05 per share, which surpassed the Zacks Consensus Estimate of $1.46. The bottom line also jumped 123% from the year-ago profit of 92 cents. The recreational vehicle maker registered revenues of $2,537 million for the quarter under review, beating the Zacks Consensus Estimate of $2,379 million. Moreover, the top line recorded a 17.5% year-over-year increase.Consolidated backlog totaled $8.92 billion at quarter-end, representing a 194.5% jump from the year-ago period.

Tesla TSLA has decided to suspend the production of high-end Model S and X electric vehicles (EVs) at the Fremont factory in California from Dec 24 to Jan 11.There are various theories as to why the production line has been temporarily shut down. Some say that the shutdown is for potential reforms of the S and X production lines. Other theories claim that there might be minor design alterations for Model S and Model X, similar to those applied to the Model 3. Another is that the battery designs outlined for Model 3 and Model Y are also being used for these premium vehicles.

Meanwhile, the red hot EV maker also announced plans to raise up to $5 billion via equity offering in a bid to fortify the balance sheet and wrapped up the sale of its stock offering within a day. Importantly, this was the firm’s second capital raise via equity financing in the last three months. Earlier in September, it announced a $5-billion capital raise, leveraging its impressive share price gains.

Tesla currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

NIO Inc. NIO priced its 68-million stock offering at $39 per ADS, with a 30-day option to increase up to 78.2 million American depositary shares. The company aims to use 60% of the proceeds from the offering, primarily for research and development of new products, as well as driverless technologies. Around 30% will be directed toward expansion of sales and service network, while the remaining 10% will be allocated for general corporate purposes.

Price Performance

The following table shows the price movement of some of the major auto players over the past week and six-month period.

In the past six months, all stocks have increased, with Tesla being the maximum gainer. Over the last week, all stocks have decreased apart from Toyota TM and Advance Auto Parts AAP.

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Toyota Motor Corporation (TM) : Free Stock Analysis Report
 
Advance Auto Parts, Inc. (AAP) : Free Stock Analysis Report
 
AutoZone, Inc. (AZO) : Free Stock Analysis Report
 
Thor Industries, Inc. (THO) : Free Stock Analysis Report
 
Tesla, Inc. (TSLA) : Free Stock Analysis Report
 
NIO Inc. (NIO) : Free Stock Analysis Report
 
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