Westport Fuel Systems Inc. (NASDAQ:WPRT) is a developer and supplier of alternative fuel, low-emissions transportation technologies. The company was formed by the merger of Westport Innovations Inc. and Fuel Systems Solutions, Inc.
Westport Fuel Systems has strategic relationships with three of the world's top four engine producers. It also either supplies or has strategic relationships with 6 of the 10 leading truck producers in the world, and 7 of the 10 leading automotive manufacturers globally. These aid significant cost savings. Westport Fuel Systems also makes investments and acquisitions related to technologies and businesses that complement or help in commercialization of its products.
However, Westport Innovations has been incurring losses over the past several years. As a result, it has significant accumulated deficit. The company has also been witnessing a fall in revenues. As a result, investors have been eagerly awaiting its latest earnings report. Let’s take a quick look at this Canada-based company’s second-quarter release.
Estimate Trend & Surprise History
Investors should note that the loss estimate for Westport Fuel Systems for the second quarter stayed stable over the past 7 days but narrowed by 2 cents over the last 30 days.
However, the company has a weak record of surprises in recent quarters. It has missed the Zacks Consensus Estimate in each of the trailing 4 quarters with a negative average surprise of 50%.
Zacks Rank
Westport Fuel Systems currently has a Zacks Rank #2 (Buy), but that could change following its earnings report which was just released. We have highlighted some of the key stats from this just-revealed announcement below:
Loss
Westport Fuel Systems recorded adjusted loss of 53 cents per share in the second quarter of 2016, wider than the year-ago loss of 27 cents. Moreover, the adjusted loss, which excludes 58 cents from non-recurring items, was much wider than the Zacks Consensus Estimate of a loss of 22 cents.
Revenues
Westport Fuel Systems logged revenues of $44.4 million in the second quarter of 2016, up 59.4% year over year, due to the addition of Fuel Systems' revenues. Moreover, the figure surpassed the Zacks Consensus Estimate of $39 million.
Key Stats/Developments to Note
In the second quarter of 2016, Westport Fuel Systems sold a portion of its economic interest in Weichai Westport Inc. (WWI) to Cartesian Capital Group for $6.3 million plus a potential future payment based on Cartesian's return on investment. As a result, the company has removed WWI a business segment.
Westport Fuel Systems now has four reporting segments: Automotive Business Unit, Industrial Business Unit, Corporate and Technology Investments Business Unit, and Cummins (NYSE:CMI) Westport Inc. Joint Venture.
Market Reaction
Westport Fuel Systems’ shares have gained 4.7% so far, following the release. Clearly, the initial reaction to the release is positive.
Check back later for our full write up on Westport Fuel Systems’ earnings report!
WESTPORT FUEL (WPRT): Free Stock Analysis Report
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