This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Federal-Mogul Keeps Rising After 1Q Report

NEW YORK (AP) â¿¿ Shares of Federal-Mogul Corp. continued to climb Thursday as Wall Street was encouraged by the auto parts supplier's first-quarter results.

THE SPARK: The Southfield, Mich., company reported its quarterly results Wednesday morning. Federal-Mogul said it lost $34 million, or 34 cents per share, in the most recent quarter after reporting net income of $32 million, or 32 cents per share, a year ago. Revenue fell 2 percent to $1.7 billion.

Analysts were expecting a loss of 21 cents per share and $1.75 billion in revenue, according to FactSet.

Federal-Mogul said its results were affected by a decrease in the production of commercial vehicles worldwide and reduced production of small vehicles in Europe. It reported $8 million in restructuring costs during the quarter and expects about $80 million in total restructuring items for the year.

THE BIG PICTURE: Federal-Mogul makes powertrain and safety systems. In March the company sold its Sintertech SAS business to a company controlled by French industrialist Thierry Morin. The business develops, produces and sells powdered metal components for engines and gearboxes for use in vehicles and other industrial equipment, along with powdered metal filtration materials mainly used in the chemical industry, Federal-Mogul said.

Federal-Mogul said it didn't consider the business to be one of its core operations.

The company said in July that it would close or downsize some facilities in North America and said in February that it would make other moves, including the closing or downsizing of manufacturing plants in Western Europe. Those changes are being made in reaction to weaker demand in Europe.

THE ANALYSIS: Goldman Sachs analyst Patrick Archambault upgraded the shares to "Neutral" from "Sell," saying the results were better than expected and the price of Federal-Mogul shares has declined to a more reasonable level.

Archambault raised his six-month price target to $6 per share from $5. He had previously placed Federal-Mogul on a list of stocks carrying strong negative recommendations.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG

Markets

Chart of I:DJI
DOW 17,550.69 -47.51 -0.27%
S&P 500 2,093.32 -4.72 -0.22%
NASDAQ 5,105.5460 -9.8360 -0.19%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs