Bear of the Day: Lear Corp. (LEA) - Green Entrepreneur

You're reading Entrepreneur United States, an international franchise of Entrepreneur Media. This story originally appeared on Zacks

Lear Corporation LEA is getting hit by the semiconductor shortage. This Zacks Rank #5 (Strong Sell) saw revenue fall 13% in the third quarter.
Lear is a leading provider of Seating and E-Systems for the automotive industry. Headquartered in Michigan, it has employees in 38 countries.
An Earnings Miss in the Third Quarter
Lear reported third quarter results on Nov 2 and missed on the Zacks Consensus Estimate by $0.03. Earnings were $0.53 versus the Zacks Consensus of $0.56.
While it saw sales growth over the market of 9 percentage points, sales did decrease to $4.3 billion from $4.9 billion a year ago due to global vehicle production declines related to the semiconductor shortage.
Without those semiconductors, they can't deliver the cars.
In the quarter, Lear entered into an agreement to acquire Kongsberg Automotive's Interior Comfort Division, a leader in massage and lumbar for automotive seating applications.
Lowered Full Year Guidance
Due to lower auto production, Lear lowered its full year sales guidance to a range of $18.8 billion to $19.2 billion from its prior guidance given in the second quarter of $19.7 billion to $20.5 billion.
5 analysts cut their full year earnings estimates for both 2021 and 2022. One analyst even lowered their 2021 estimate in the last week.
The 2021 Zacks Consensus Estimate fell to $7.83 from $11.55 just 90 days ago.
That's still earnings growth of 46.9% as the company made just $5.33 last year, as the pandemic hit.
2022 is expected to look brighter still, even though analysts have gotten less bullish on it in the past month.
The 2022 Zacks Consensus has fallen to $15.21 from $18.12 in the prior 90 days, but that's still up 94% from this year.
Raised its Dividend Again
On Nov 18, Lear announced it was raising its quarterly dividend to $0.77 from $0.50. It's payable on Dec 29 to shareholders of record as of the close of business on Dec 10, 2021.
That increase returned the dividend to its pre-pandemic levels.
It's currently yielding 1.7%.
A Buying Opportunity?
While shares of Lear are off their 2020 coronavirus lows, they have been weak over the last 6 months thanks to the semiconductor shortage.
Shares have fallen 7.9% during that time.

- Zacks

Image Source: Zacks Investment Research

With the earnings estimates being cut, the shares aren't cheap on a forward P/E basis. They're trading at 22.9x.
But investors interested in the auto parts plays, might want to keep Lear on their watch list for changes to a more favorable Zacks Rank and because the shares will get even cheaper on further weakness.

Investor Alert: Legal Marijuana Looking for big gains?

Now is the time to get in on a young industry primed to skyrocket from $13.5 billion in 2021 to an expected $70.6 billion by 2028.

After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could kick start an even greater bonanza for investors. Zacks Investment Research has recently closed pot stocks that have shot up as high as +147.0%

You’re invited to immediately check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.

Today, Download Marijuana Moneymakers FREE >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Lear Corporation (LEA): Free Stock Analysis Report
 
To read this article on Zacks.com click here.

Adblock test (Why?)

"corp" - Google News
November 30, 2021 at 03:22AM
https://ift.tt/2ZGcy8M

Bear of the Day: Lear Corp. (LEA) - Green Entrepreneur
"corp" - Google News
https://ift.tt/2RhVoHj
Shoes Man Tutorial
Pos News Update
Meme Update
Korean Entertainment News
Japan News Update

Bagikan Berita Ini