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The Zacks Analyst Blog Highlights: Advance Auto Parts, Ford, General Motors, Fiat Chrysler and Meritor

Zacks Equity Research
·5 min read

For Immediate Release

Chicago, IL – November 17, 2020 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Advance Auto Parts, Inc. AAP, Ford Motor Company F, General Motors Company GM, Fiat Chrysler Automobiles N.V. FCAU and Meritor, Inc. MTOR.

Here are highlights from Monday’s Analyst Blog:

Auto Stock Roundup: GM-Unifor Deal, Ford EVs and More

Last week, China Association of Automobile Manufacturers (“CAAM”) disclosed vehicle sales data for the month of September. Auto sales in the country climbed 12.5% year over year to 2.6 million units for September, marking the seventh straight month of year-over-year growth.

While China is spearheading the global auto industry’s revival, total vehicle sales through the January-October 2020 period is still below the pre-COVID-19 levels and declined 4.7% from the year-ago comparable period. Per CAAM, sales of new energy vehicles rose 105% year over year in October, marking the fourth straight month of sales increase after snapping a year-long slump in July.

(Read the Last Auto Stock Roundup here)

Recap of the Week’s Most Important Stories

Advance Auto Parts reported adjusted earnings of $2.81 per share in third-quarter 2020 (ended Oct 3, 2020), reflecting a substantial increase of 33.8% from the prior-year figure. The reported figure also beat the Zacks Consensus Estimate of $2.63. The company’s generated net revenues of $2,541.9 millionsurpassed the Zacks Consensus Estimate of $2,478 million.

Additionally, the revenue figure increased 9.9% from the year-ago quarter reported figure. During the third quarter, comparable store sales not only increased 10.2% year on year but also topped the consensus mark of 5.88%. As of Oct 3, 2020, the company operated 4,811 stores and 168 Worldpac branches in the United States, Canada, Puerto Rico and the U.S. Virgin Islands.

Ford announced the decision to manufacture its all-new E-Transit van at the company’s Kansas City Assembly Plant. It is investing roughly $100 million in the Kansas City plant. The all-electric E-Transit will enter the market in 2022.

The decision is part of the firm’s investment plans of more than $3.2 billion in its North American manufacturing facilities to produce a line-up of new electric vehicles (EVs) for commercial and retail customers. Notably, Ford will invest more than $11.5 billion globally in electrification through 2022.

General Motors recently announced that its workers in Canada, represented by Unifor, have agreed to a new three-year collective agreement between the union body and the company. The deal encompasses General Motors’ investment to the tune of $1.3 billion, creating 1,700 jobs in the Oshawa plant.

More than $109 million will be invested to facilitate V-8 engine and transmission production in St. Catharines.The Oshawa plant will resume production of both light and heavy-duty trucks in 2022, and St. Catharines will manufacture engines for those pick-ups. Unifor’s deal with General Motors marks the third consecutive win for the union body after it struck similar deals with Ford and Fiat Chrysler. General Motors currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Meritor posted adjusted diluted earnings per share of 15 cents in fourth-quarter fiscal 2020 (ended Sep 30, 2020), handily beating the Zacks Consensus Estimate of 5 cents.The bottom line, however, declined from the year-ago adjusted earnings of 83 cents a share. Sales slipped 26% year over year to $758 million in the fiscal fourth quarter.

Nonetheless, the reported figure surpassed the Zacks Consensus Estimate of $728 million.For fiscal 2021, Meritor projects sales in the range of $3.1billion to $3.35 billion. Cash flow from operations and free cash flow are anticipated in the range of $145-$185 million and $60-$100 million, respectively.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


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