Earnings Review and Free Research Report: Cooper Tire Beat Earnings Expectations

Research Desk Line-up: Trinseo Post Earnings Coverage

LONDON, UK / ACCESSWIRE / August 24, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Cooper Tire & Rubber Co. (NYSE: CTB), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=CTB, following the Company’s reporting of its second quarter fiscal 2017 financial results on August 04, 2017. The tire maker reported a y-o-y decline in revenue and earnings. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member’s account at:

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Get more of our free earnings reports coverage from other constituents of the Rubber & Plastics industry. Pro-TD has currently selected Trinseo S.A. (NYSE: TSE) for due-diligence and potential coverage as the Company reported on August 02, 2017, its financial results for Q2 2017. Register for a free membership today, and be among the early birds that get access to our report on Trinseo when we publish it.

At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on CTB; also brushing on TSE. With the links below you can directly download the report of your stock of interest free of charge at:

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Earnings Reviewed

Cooper Tire’s net sales were $721 million in Q2 2017, down 2.6% compared to $740 million in Q2 2016. The Company’s reported quarter net sales were negatively impacted by lower unit volume and foreign currency, partially offset by a favorable price and mix. The Company’s revenue numbers missed analysts’ estimates of $770.7 million.

During Q2 2017, Cooper Tire’s unit volume was down 0.5% on a y-o-y basis. The Company’s unit volume in the Americas segment declined 4.4%, with a decrease in North America. The North America result was partially offset by improved unit volume performance in the International segment, which was up 11.1%.

Cooper Tire’s operating profit was $75 million in Q2 2017 compared to $110 million in Q2 2016. The Company’s operating profit decreased as a result of $35 million in unfavorable raw material costs, net of price and mix; $9 million of higher manufacturing costs; and $9 million of lower unit volume. These higher costs were partially offset by $14 million of lower selling, general, and administrative expenses (SG&A), and $3 million of lower product liability costs.

The Company reported net income of $45.31 million, or $0.85 per diluted share, compared to net income of $70.75 million, or $1.27 per share. for Q2 2016. The Company’s revenue numbers exceeded Wall Street’s estimates for earnings of $0.74 per share.

Americas Tire Operations

Cooper Tire’s net sales in the Americas segment declined 6.0% to $615 million in Q2 2017, as a result of $44 million of lower unit volume and $1 million of negative foreign currency impact. The segment’s unit volume decreased 4.4% on a y-o-y basis.

Cooper Tire’s total light vehicle tire shipments in the US decreased 10.0% in a competitive pricing and promotional environment in Q2 2017, as the industry experienced weak sell-out volumes. The US Tire Manufacturers Association (“USTMA”) reported that its member shipments of light vehicles in the US were down 2.2%. The Company’s TBR tire shipments for the US surged 27.4% in Q2 2017, significantly outperforming both the industry and the USTMA.

Cooper Tire’s Americas segment operating profit was $83 million, or 13.5% of net sales, in Q2 2017 compared to $116 million, or 17.7% of net sales, in Q2 2016. Operating profit was impacted by $31 million of unfavorable raw material costs, net of price and mix; $11 million of lower unit volume; and $9 million of unfavorable manufacturing costs.

International Tire Operations

During Q2 2017, Cooper Tire’s net sales in the International segment rose 22.4% to $151 million, driven by a $27 million of favorable price and mix, primarily due to net price increases related to higher raw material costs, and $8 million of higher unit volume, partially offset by $8 million of negative foreign currency impact. The segment’s unit volume grew 11.1% on a y-o-y basis, with increased unit volume in Asia that was partially offset by a decreased unit volume in Europe.

International segment’s operating profit was $1 million in Q2 2017 compared to operating profit of $3 million in Q2 2016. The decline was driven by $2 million of unfavorable raw material costs, net of price and mix, and $1 million of other costs, including foreign currency impact, which were partially offset by $1 million of higher unit volume.

Cash Matters

At the end of Q2 2017, Cooper Tire had $302 million in cash and cash equivalents compared to $412 million at the end of Q2 2016. The Company’s capital expenditure in the reported quarter was $45 million compared to $49 million in the year ago same period. Cooper Tire generated a 14.6% return on invested capital for the trailing four quarters.

During Q2 2017, the Company repurchased 568,224 shares for $20.8 million at an average price of $36.55 per share. Through H1 2017, Cooper Tire repurchased 1,041,191 shares for $38.6 million. Since share repurchases began in August 2014, the Company has repurchased a total of 13.3 million shares at an average price of $34.31 per share.

On August 02, 2017, Cooper Tire announced a quarterly dividend of $0.105 per share on common stock, payable on September 29, 2017, to stockholders of record at the close of business on September 01, 2017.

Outlook

For FY17, Cooper Tire is forecasting unit volume growth in the International segment and in Latin America. Unit volume in the US is expected to be in-line with the industry for H2 2017. The Company’s full year 2017 consolidated operating margin is expected to be at the high end of its previously announced mid-term target of 8% to 10%. Cooper Tire’s capital expenditure is expected to range between $200 million and $220 million for the year.

Stock Performance

On Wednesday, August 23, 2017, Cooper Tire & Rubber’s stock closed the trading session at $33.25, marginally falling 0.75% from its previous closing price of $33.50. A total volume of 370.97 thousand shares were exchanged during the session. Shares of the Company have a PE ratio of 9.21 and have a dividend yield of 1.26%. The stock currently has a market cap of $1.73 billion.

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