Lear Corporation Earnings Cheat Sheet: Beats Expectations

Lear Corporation (NASDAQ:LEA) reported net income above Wall Street’s expectations for the second quarter. Lear Corporation and its affiliates design and manufacture complete automotive seat systems and the components thereof, as well as electrical distribution systems and electronic products.

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Lear Earnings Cheat Sheet for the Second Quarter

Results: Net income for Lear Corporation rose to $177.5 million ($1.65 per share) vs. $159.8 million ($1.48 per share) in the same quarter a year earlier. This marks a rise of 11.1% from the year earlier quarter.

Revenue: Rose 21.7% to $3.7 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: LEA reported adjusted net income of $1.54 per share. By that measure, the company beat the mean estimate of $1.27 per share. It beat the average revenue estimate of $3.44 billion.

Quoting Management: “Lear’s positive momentum continued in the second quarter. We were able to increase sales and earnings at a faster rate than industry production in our major markets. Both of our business units are performing well and continue to win new business. Our balance sheet is exceptionally strong, and with $1.8billion in cash, we have the resources to drive further growth and enhance shareholder value,” said Bob Rossiter, Lear’s chief executive officer and president.

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 20.1%, with the biggest boost coming in the second quarter of the last fiscal year when revenue rose 33.2% from the year earlier quarter.

The company has now topped analyst estimates for the last four quarters. It beat the mark by 32 cents in the first quarter, by 27 cents in the fourth quarter of the last fiscal year, and by 59 cents in the third quarter of the last fiscal year.

Gross margins grew 0.4 percentage point to 10%. The growth seemed to be driven by increased revenue, as the figure rose 21.7% from the year earlier quarter while costs rose 21.2%.

Competitors to Watch: Johnson Controls, Inc. (NYSE:JCI), Visteon Corporation (NYSE:VC), Gentex Corporation (NASDAQ:GNTX), General Electric (NYSE:GE), United Technologies Corp. (NYSE:UTX), Honeywell Intl. Inc. (NYSE:HON).

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(Source: Xignite Financials)