Navistar (NYSE:NAV) International Corporation NAV reported fourth-quarter fiscal 2020 adjusted earnings of 62 cents per share, surpassing the Zacks Consensus Estimate of 23 cents. The outperformance primarily stemmed from higher-than-expected revenues from the firm’s Truck segment. Precisely, revenues from the segment came in at $1,478 million, outpacing the consensus mark of $1,278 million.
The bottom line, however, deteriorated from the year-ago profit of $1.14 per share amid lower year-over-year revenues due to the coronavirus pandemic.
The truck maker registered revenues of $2,065 million for the October-end quarter, missing the Zacks Consensus Estimate of $2,090 million. Moreover, the top line marked a 25.7% year-over-year plunge due to coronavirus-led lower demand in core markets.
During the quarter, the company announced its merger agreement with Volkswagen (DE:VOWG_p)’s VWAGY trucks arm Traton SE. This is expected to buoy the combined entity’s prospects.
Navistar International Corporation Price, Consensus and EPS Surprise
Navistar International Corporation price-consensus-eps-surprise-chart | Navistar International Corporation Quote
Segmental Performance
The Truck segment’s total net sales came in at $1,478 million for the reported quarter, plummeting 30% year over year. The segment witnessed a net loss of $10 million against profit of $86 million reported in the year-ago quarter. This was due to lower volumes on weaker industry conditions resulting from the pandemic.
The Parts segment net sales dropped 9.3% from the year-ago quarter to $496 million. The segment’s profit was $129 million, down 19.8% on a year-over-year basis. The segment’s results were impacted by lower volumes in the United States and Canada.
Net sales in the company’s Global Operations summed $87 million, down from $93 million recorded in the year-ago quarter. Unfavorable forex translations and depressed volumes from South American operations amid temporary production halts due to the coronavirus crisis resulted in this downside. The segment reported a profit of $12 million, turning around from the year-ago quarter’s loss of $10 million that stemmed from a restructuring charge.
Net sales in Navistar’s Financial Services segment came in at $47 million, reflecting a 34% decrease from the year-ago quarter. The segment recorded a profit of $14 million compared with the year-ago quarter’s $30 million. This deterioration resulted from lower average finance receivables due to dismal volumes and reduction in finance fees on lower interest rates.
Financial Position
The Illinois-based trucking giant had cash and cash equivalents of $1,843 million as of Oct 31, 2020, higher than $1,370 million on Oct 31, 2019. At fiscal fourth quarter-end, long-term debt was $4,690 million, up from $4,317 million as of Oct 31, 2019.
Navistar currently carries a Zacks Rank #2 (Buy). Other top-ranked stocks in the auto space include BRP (NASDAQ:DOOO) Inc. DOOO and Magna International (NYSE:MGA) Inc. (MGA, each sporting Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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