For Immediate Release
Chicago, IL - September 25, 2015 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Volkswagen AG ( VLKAY ), General Motors Company ( GM ), Tesla Motors, Inc. ( TSLA ), AutoZone, Inc. ( AZO ) and Thor Industries Inc. ( THO ).
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Here are highlights from Thursday's Analyst Blog:
Auto Stock Roundup
The Volkswagen AG ( VLKAY ) scandal shook the auto sector as well as the U.S. market last week. While the German automaker's stock took a plunge, the controversy pulled down the stocks of its suppliers and peers as well.
In another major development, General Motors Company ( GM ) reached a $900 million settlement in the ignition switch case. Any action on the charges against the company will be deferred for 3 years and may even be dismissed if it manages to fulfill the settlement terms.
Meanwhile, Tesla Motors, Inc. ( TSLA ) signed another agreement to purchase lithium hydroxide for its Gigafactory. Further, AutoZone, Inc. ( AZO ) and Thor Industries Inc. ( THO ) reported fourth-quarter results.
(Read last to last week's recap here: Auto Stock Roundup for Sep 17, 2015 )
Recap of the Week's Most Important Stories
1. The Environmental Protection Agency (EPA) revealed that Volkswagen had developed a software algorithm which allowed it to deceive U.S. emissions tests. The software switches on pollution controls during emission tests but switches them off when the vehicle is on road. The company has accepted that its diesel vehicles in the U.S. are fitted with the software. The relevant vehicles include Jetta, Beetle, Audi A3 and Golf from model years 2009-2015 and Passat of model years 2014 and 2015.
According to the EPA, the Volkswagen vehicles in question emit nitrogen oxides, or NOx, at almost 40 times the standard amount. Consequently, Volkswagen has been forced to halt the sale of its popular diesel-powered vehicles in the U.S. Many other countries have also started investigating whether Volkswagen uses similar tactics to deceive their respective emission tests (read more: Will Volkswagen's Software Trick Hurt the Auto Industry? ).
2. General Motors announced a settlement over the ignition switch issue with the U.S. Attorney's Office for the Southern District of New York. The company was charged for not disclosing safety concerns related to the faulty ignition switches to regulators, thereby misleading consumers. The automaker signed a deferred-prosecution agreement as part of the settlement.
Per the terms laid down, General Motors will have to cooperate with the federal government which will create an independent monitor to analyze the automaker's policies and procedures associated with safety issues and recalls. The company will also have to pay a fine of $900 million, which is likely to be reflected in its third-quarter results (read more: GM & Regulators Reach Settlement on Ignition Switch Case ).
3. Tesla has signed an agreement with Pure Energy Minerals to purchase lithium hydroxide produced from the Clayton Valley, Nevada Lithium Brine Project of the latter. However, the deal is subject to fulfillment of certain terms by Pure Energy Minerals. Moreover, Pure Energy Minerals will conduct a preliminary economic assessment to gauge the viability of the mining operation.
Subject to the fulfillment of these terms, Tesla or its authorized purchasers will buy a specified amount of lithium hydroxide from Pure Energy Minerals over a five-year period at a set price, which is below the current market rate (read more: Tesla Looks to Secure Lithium Supply with New Deal ).
4. AutoZone reported a 13% rise in earnings per share to $12.75 for the fourth quarter of fiscal 2015 (ended Aug 29, 2015) from $11.28 recorded in the year-ago quarter. Earnings also surpassed the Zacks Consensus Estimate of $12.67. Quarterly revenues improved 7.9% year over year to $3.29 billion, beating the Zacks Consensus Estimate of $3.25 billion (read more: AutoZone's Q4 Earnings, Revenues Beat Estimates ).
5. Thor Industries reported fourth-quarter fiscal 2015 (ended Jul 31, 2015) adjusted earnings of $1.14 per share that missed the Zacks Consensus Estimate of $1.32. Meanwhile, adjusted earnings increased from $1.13 per share recorded in the fourth quarter of fiscal 2014. Revenues rose 2% year over year to $1.06 billion, lagging the Zacks Consensus Estimate of $1.16 billion. The year-over-year improvement in the top line was driven by the addition of revenues from Postle, acquired earlier this year, which offset the lower sales of both towable and motorized recreational vehicles.
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