Yesterday’s Consumer Pops and Drops: MDLZ, CAJ, THO, NWL, and WBC
Price movement of WABCO
WABCO (WBC) has a market cap of $6.0 billion. WBC rose by 4.9% to close at $105.87 per share on March 17, 2016. Its price movement on a weekly, monthly, and YTD (year-to-date) basis is 9.3%, 10.2%, and 3.5%, respectively.
Currently, WBC is trading at 9.8% above its 20-day moving average, 14.9% above its 50-day moving average, and 2.1% below its 200-day moving average.
The ALPS International Sector Dividend Dogs ETF (IDOG) invests 2.1% of its holdings in WABCO. The ETF tracks an equal-weighted index that selects the five companies with the highest dividend yield in each of the ten GICS (Global Industry Classification Standard) sectors from international developed markets. The YTD price movement of IDOG was 1.4% as of March 16, 2016.
The market caps of WABCO’s competitors are as follows:
General Motors (GM) — $49.4 billion
PACCAR (PCAR) — $19.3 billion
Cummins (CMI) — $19.1 billion
Meritor and WABCO appoint president
Meritor and WABCO, parent companies of the 50-50 joint venture Meritor WABCO, have appointed Matthew Stevenson as president and general manager of Meritor WABCO, effective immediately. Stevenson has 20 years of experience in sales, marketing, product strategy, and business development in the commercial vehicle and automotive industries. The company will hold its fiscal 1Q16 earnings conference call on April 22, 2016.
Performance of WABCO in 4Q15 and 2015
WABCO reported fiscal 4Q15 sales of $670.6 million, a fall of 1.3% from the sales of $679.1 million in fiscal 4Q14. The company’s gross profit fell by 2.2% and its operating income rose by 9.0% between fiscal 4Q14 and fiscal 4Q15.
Its net income and EPS (earnings per share) rose to $98.7 million and $1.71, respectively, in fiscal 4Q15, compared with $65.1 million and $1.10, respectively, in fiscal 4Q14.
Fiscal 2015 results
In fiscal 2015, WABCO reported sales of $2.7 billion, a fall of 7.8% year-over-year. Its net income and EPS fell to $275.2 million and $4.72, respectively, in fiscal 2015, from $291.5 million and $4.81, respectively, in fiscal 2014.
Meanwhile, its cash and cash equivalents and inventories rose by 25.1% and 12.2%, respectively, in fiscal 2015. Its current ratio and debt-to-equity ratio rose to 3.0 and 2.1, respectively, in fiscal 2015, compared with 2.8 and 1.7, respectively, in fiscal 2014. WABCO’s price-to-earnings and price-to-book value ratios were 22.4x and 7.7x, respectively, as of March 17, 2016.
The company made the following projections for fiscal 2016:
It expects sales growth of 6%–11% in local currencies
On a performance basis, due to the European Commission’s January 2016 decision against the Belgian tax authority, its guidance includes the performance tax rate of 20%
On a performance basis, it expects an operating margin of 13.8%–14.3% and diluted EPS of $5.30–$5.80
On a GAAP (generally accepted accounting principles) basis, it expects an operating margin of 12.7%–13.2% and diluted EPS of $3.43–$3.93
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