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The Zacks Analyst Blog Highlights: General Motors, Toyota Motor, Navistar International, AutoZone and BMW AG

Zacks Equity Research

For Immediate Release

Chicago, IL – March 10, 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: General Motors GM, Toyota Motor TM, Navistar International Corp. NAV, AutoZone, Inc. AZO and BMW AG BAMXF.

Here are highlights from Monday’s Analyst Blog:

Auto Stock Roundup: GM’s EV Push, AZO, NAV Quarterly Reports & More

Last week, China Passenger Car Association came up with February vehicle sales numbers in China. Per its reports, new car sales in China plummeted 80% year over year in February 2020. This marked the biggest monthly plunge on record as coronavirus concerns kept showroom traffic very low. Global automakers who have become increasingly reliant on the world’s biggest market for vehicles are left with little visibility into when sales might recover.  (Read more: Auto Sales in China Log the Biggest Monthly Decline Ever)

Meanwhile, despite the coronavirus outbreak, February turned out to be a decent month for U.S. auto sales, as year-over-year gains were recorded across the board by firms. Fat discounts along with President Day deals led to healthy sales. Nonetheless, one will not be able to get a clear picture of how U.S. auto sales are progressing, as sector biggies like BMW, Volkswagen and Nissan will henceforth announce quarterly sales like Detroit 3 carmakers.

February U.S. auto sales rose 18.2%, 19%, 20%, 15.8% and 13% at Volvo, Mazda, Kia, Hyundai and Mitsubishi, respectively. U.S. auto sales of Japan’s top carmaker Toyota Motor recorded a 13.4% rise, and that of its close rival Honda Motor increased 15.8% year over year.

(Read the Last Auto Stock Roundup here)

Recap of the Week’s Most Important Stories

General Motorsaims to spend more than $20 billion through 2025 to launch gen-next EVs powered by new-low cost batteries. HE COMPANY plans to roll out 11 new EVs as part of its ambitious plans through 2025, including at least 20 new models by 2023. The key element of the automaker’s strategy is the new battery system ‘Ultium,’ which is set to power General Motors’ EVs starting next year. All four brands of the company including Chevy, Cadillac, GMC and Buick are set to launch new battery-powered vehicles. The new models will include Chevron Bolt EV and EUV, two Buick SUVs, GMC Hummer in both SUV and pickup formats, Cadillac Lyriq SUV and Cadillac sedan Celistiq.  The auto giant is aiming to sell a million EVs annually by 2025 in the United States and China.

Toyota Motor recalled 1.2 million vehicles, including trucks, SUVs, minivans and cars across the model line-ups of its namesake and Lexus brands in the United States, in order to fix fuel-pump issues. These vehicles have fuel pumps that can stop operating, causing the cars to stall, in turn, escalating the risk of a crash. This January, the company recalled 700K vehicles in the United States over the same issue. Per the company, about 118,000 vehicles in the January recall shouldn’t have been included. However, the recall now covers 1.8 million in the United States and 3.2 million vehicles worldwide. (Read more: Toyota Recalls 3.2M Vehicles Worldwide Over Faulty Fuel Pumps)

Navistar International Corp. came out with first-quarter fiscal 2020 loss of 33 cents per share, narrower than the Zacks Consensus Estimate of a loss of 38 cents. However, the bottom line tanked from the year-ago earnings of 11 cents a share. Soft year-over-year contribution across all segments led to the underperformance. The truck manufacturer generated $1,838 million in revenues, which missed the Zacks Consensus Estimate of $1,854 million. Revenues also marked a 24.4% fall from the year-earlier reported figure. At the end of the quarter, long-term debt was $4,283 million. During the quarter, capital expenditure totaled $59 million. Navistar reiterated industrial and financial forecasts for fiscal 2020. (Read more: Navistar Q1 Loss Narrower Than Expected, Sales Lag)

AutoZone, Inc. has reported earnings of $12.39 per share in the second quarter of fiscal 2020 (ended Feb 15, 2020), up from the prior-year quarter figure of $11.49. Further, the reported figure surpassed the Zacks Consensus Estimate of $11.87. Net income inched up 1.6% year over year to $299.3 million. In the reported quarter, net sales increased 2.6% year over year to $2,513.7 million. However, the top line missed the Zacks Consensus Estimate of $2,580 million. During the fiscal second quarter, AutoZone opened 25 stores in the United States, two in Mexico and one in Brazil. It exited the quarter with 5,815 stores in the United States, 608 in Mexico and 38 in Brazil. The total store count was 6,461 as of Feb 15, 2020. (Read more: AutoZone's Q2 Earnings Top, Sales Miss Estimates)

BMW AG is set to roll out three new models over the next two years. The BMW i4, along with the BMW iNEXT, an all-electric crossover, will enter the market in 2021, while the BMW iX3, an all-electric SUV, is due to go on sale by the end of this year. The BMW Concept i4 is claimed to be capable of running up to 600 km on a single charge. With a 150kW charger, the i4's battery can be charged to 80% in 35 minutes. BMW iX3 will rely on a 74-kWh battery pack, which will enable it to travel up to 273 miles (440 kilometers), on a single charge. BMW iNext is expected to include hardware that could take iNext to Level 3 autonomy at up to 80 MPH. (Read more: Here's a Sneak Peek into BMW's EV Offerings For 2020 & 2021)

Price Performance

In the past week, all stocks apart from Tesla and Honda declined, with Harley Davidson registering the maximum loss. In the past six months, Tesla has been the maximum gainer, while Ford has declined the most.

What’s Next in the Auto Space?

In addition to usual news releases, all eyes will remain glued to how automakers tackle the coronavirus scare and mitigate its overall impact on the industry.

More Stock News: This Is Bigger than the iPhone!

It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.

Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.

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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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Navistar International Corporation (NAV) : Free Stock Analysis Report
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AutoZone, Inc. (AZO) : Free Stock Analysis Report
Bayerische Motoren Werke AG (BAMXF) : Free Stock Analysis Report
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