Meritor, Inc.
MTOR
posted adjusted earnings per share of 98 cents in second-quarter fiscal 2022, increasing 44.12% from 68 cents in the year-ago quarter. The metric marginally beat the Zacks Consensus Estimate of 96 cents. Adjusted income from continuing operations was $70 million in the reported quarter, increasing from $50 million recorded in the prior-year quarter.
Sales grew 17.4% year over year to $1,154 million in the fiscal second quarter. The top line also beat the Zacks Consensus Estimate of $1,074.9 million.
Adjusted EBITDA went up to $127 million from the year-earlier quarter’s $111 million. The upside stemmed from higher sales volumes, partially offset by higher steel and freight costs. Adjusted EBITDA margin decreased to 11% from 11.3%.
Meritor, Inc. Price, Consensus and EPS Surprise
Meritor, Inc. price-consensus-eps-surprise-chart
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Meritor, Inc. Quote
Segment Results
In the reported quarter, revenues from the Commercial Truck & Trailer segment amounted to $938 million, growing 21% year over year on higher global truck production in all markets and pricing actions. The segment reported an adjusted EBITDA of $78 million, rising $5 million from the year-ago quarter level. EBITDA margin came in at 8.3% during the quarter, down from 9.4%. The decline was due to higher net steel and freight costs, which unfavorably impacted the conversion on sales.
Quarterly revenues in the Aftermarket & Industrial segment totaled $262 million, up 6% from the year-ago level on higher pricing in the quarter. The segment’s adjusted EBITDA was $44 million, an increase of $10 million from the year-ago quarter. EBITDA margin came in at 16.8%, up from 13.8% recorded in the prior-year quarter, primarily due to pricing actions.
Financial Position
In the reported quarter, Meritor’s cash and cash equivalents summed $115 million as of Mar 31, 2022, rising from $101 million as of Sep 30, 2021. Long-term debt was $1,025 million at the end of the quarter, up from $1,008 million reported on Sep 30, 2021.
During the fiscal second quarter, Meritor’s cash used for operating activities was $17 million against $63 million of cash provided by operating activities in the year-ago quarter.
Free cash flow (FCF) in the reported quarter was a negative $38 million against a positive FCF of $47 million recorded in the same period last year. In the reported quarter, capital expenditure was $21 million compared with $16 million incurred in the year-ago quarter.
Zacks Rank & Key Picks
MTOR currently carries a Zacks Rank #4 (Sell).
Better-ranked players in the auto space include
BRP Group, Inc.
DOOO
, sporting a Zacks Rank #1 (Strong Buy) and
Dorman Products
DORM
and
Tesla Inc.
TSLA
, each carrying a Zacks Rank #2 (Buy), currently. You can see
the complete list of today’s Zacks #1 Rank stocks here
.
BRP Group has an expected earnings growth rate of 9.1% for fiscal 2023. The Zacks Consensus Estimate for current-year earnings has been revised around 7.9% upward in the past 60 days.
BRP Group’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. DOOO pulled off a trailing four-quarter earnings surprise of 68%, on average. The stock has declined 8.5% over the past year.
Dorman Products has an expected earnings growth rate of 18.8% for the current year. The Zacks Consensus Estimate for current-year earnings has been marginally revised 0.7% upwards in the past 60 days.
Dorman Products’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. DORM pulled off a trailing four-quarter earnings surprise of 3.1%, on average. The stock has lost 2.1% over the past year.
Tesla has an expected earnings growth rate of 66.1% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised around 18.7% upward in the past 60 days.
Tesla’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. TSLA pulled off a trailing four-quarter earnings surprise of 41.27%, on average. The stock has gained 35.5% over the past year.
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