Stoneridge Misses Expectations - Analyst Blog

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Stoneridge Inc. ( SRI ) posted a profit of $2.6 million or 10 cents per share in the fourth quarter of 2012 in sharp contrast to a loss of $3.9 million or 16 cents per share in the same quarter of 2011 (excluding gain related to the company's purchase of additional ownership in its Brazil-based PST joint venture on Dec 29, 2011). However, earnings per share in the quarter lagged the Zacks Consensus Estimate by 4 cents.

Revenues in the quarter went up 19.7% to $222.7 million, mainly due to the consolidation of the operating results of PST. Excluding the results of PST, revenues, in fact, declined 4.2% to $178.3 million in the quarter due to lower sales in the company's Wiring segment, mainly to a large North American commercial vehicle customer, and decreased sales to European commercial vehicle customers in the company's Electronics segment.

For 2012, Stoneridge reported a decline in profits to $5.4 million or 20 cents per share from $6.9 million or 28 cents per share in the prior year (excluding gain related to the company's purchase of additional ownership in PST). Earnings per share in the year were lower than the Zacks Consensus Estimate of 25 cents.

Revenues escalated 22.6% to $938.5 million in the year due to the consolidation of the operating results of PST. Excluding the results of PST, revenues edged down 1.0% to $758.1 million due to the same reasons that affected fourth quarter revenues.

Stoneridge had cash and cash equivalents of $44.6 million as of Dec 31, 2011, down from $78.7 million as of Dec 31, 2011. The fall in cash balance was due to $19.8 million in cash used to finance the final portion of the PST transaction, which was completed on Jan 5, 2012.  The company also reduced its debt by $65.7 million during the year.

The company's long-term debt stood at $200.2 million as of Dec 31, 2012, translating into a long-term debt-capitalization ratio of 57.2%. This is compared with a long-term debt of $228.0 million or 63.5% as of Dec 31, 2011.  

In 2012, the company's net cash flow from operations was $75.5 million, a significant improvement from $921 thousand in the prior year. Capital expenditures remained almost flat at $26.4 million compared with $26.3 million in 2011.

Stoneridge, a Zacks Rank #4 (Sell) stock, designs and manufactures engineered electrical and electronic components, modules, and systems for the medium and heavy-duty truck, agricultural, automotive, and off-highway vehicle markets, primarily in North America and Europe.

While we try to avoid Stoneridge, a few stocks that are performing well in the same industry are Active Power Inc. ( ACPW ), InvenSense, Inc. ( INVN ) and LightPath Technologies, Inc. ( LPTH ). They carry a Zacks Rank #2 (Buy).



ACTIVE POWER (ACPW): Free Stock Analysis Report

INVENSENSE INC (INVN): Free Stock Analysis Report

LIGHTPATH TECH (LPTH): Get Free Report

STONERIDGE INC (SRI): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: ACPW , INVN , LPTH , SRI

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