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Lear Corporation (NYSE:LEA) will unveil its latest earnings on Thursday, August 2, 2012. Lear and its affiliates design and manufacture complete automotive seat systems and components as well as electrical distribution systems and electronic products.
Lear Corporation Earnings Preview Cheat Sheet
Wall St. Earnings Expectations: The average estimate of analysts is for net income of $1.29 per share, a decline of 16.2% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from $1.35. Between one and three months ago, the average estimate moved down. It also has dropped from $1.31 during the last month. For the year, analysts are projecting profit of $5.19 per share, a decline of 2.8% from last year.
Past Earnings Performance: The company is looking to make a streak of three quarters of beating estimates. Last quarter, it beat expectations by reporting net income of $1.38 per share, and the previous quarter, it had profit of $1.26.
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A Look Back: In the first quarter, profit fell 14% to $134.1 million ($1.32 a share) from $156 million ($1.44 a share) the year earlier, but exceeded analyst expectations. Revenue rose 3.8% to $3.64 billion from $3.51 billion.
Stock Price Performance: Between May 2, 2012 and July 27, 2012, the stock price fell $4.66 (-11.4%), from $40.97 to $36.31. The stock price saw one of its best stretches over the last year between December 28, 2011 and January 6, 2012, when shares rose for seven straight days, increasing 7.1% (+$2.81) over that span. It saw one of its worst periods between July 18, 2012 and July 26, 2012 when shares fell for seven straight days, dropping 9% (-$3.45) over that span.
Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.53 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.55 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 12.2% to $3.44 billion while assets rose 10.2% to $5.25 billion.
On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 21% in the second quarter of the last fiscal year, 22.7% in the third quarter of the last fiscal year and 11.2% in the fourth quarter of the last fiscal year before increasing again in the first quarter.
After experiencing income drops the past two quarters, the company is hoping to use this earnings announcement to rebound. Net income dropped 9.1% in the fourth quarter of the last fiscal year and then again in the first quarter.
Analyst Ratings: With nine analysts rating the stock a buy, none rating it a sell and four rating the stock a hold, there are indications of a bullish stance by analysts.
Wall St. Revenue Expectations: Analysts predict a decline of 0.8% in revenue from the year-earlier quarter to $3.65 billion.
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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)
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