Aptiv beats on earnings and revenue despite “challenging” environment
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Aptiv beats on earnings and revenue despite “challenging” environment

This year has not been kind to the auto-industry, and futuristic car component maker Aptiv, which focuses on trends like connectivity, electrification, and self-driving tech, is no exception. The bad news is simply that the company’s first quarter 2019 earnings showed a decrease from the comparable period – the good news is that, despite this, they overshot analysts’ expectations and the company’s own guidance. Aptiv’s share price declined on the results, but it’s still outperforming the industry, and the wider market, by a wide margin this year.

Aptiv’s share price has risen by 29% so far this year

08 05 aptiv

Source: Yahoo Finance

Aptiv said that adjusted earnings per share for the quarter came in at $1.05. That’s a drop of 24c against the first quarter of 2018, but outpaces the Street’s estimates by 5c and the high point of its own guidance range by 3c. A similar story played out over revenues, with Aptiv reporting a figure of $3.58 billion for the three-month period. That’s 1.5% lower, year on year, but beat consensus estimates by $113 million, as well as exceeding the high point of its own guidance range ($3.50 billion).

On the company’s earnings call, president and CEO Kevin Clark said that it was important to keep investing inwardly despite industry headwinds: “Given our win rate on new business bookings and the size and scale of our funnel of new business opportunities, we believe it's important that we continue to invest in our safe, green and connected technologies even in this more challenging macro environment, thereby, further expanding our competitive moat and better positioning Aptiv for sustained value creation.”

He also praised the company for “another strong quarter” that validated its “operating model, portfolio of advanced technologies,” and business strategy.

Disclosure

Dominion holds Aptiv in its Global Trends Managed Fund.


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