"A jump in demand in China, ongoing growth from advanced electronics capabilities, and recent acquisitions have positioned Delphi for double-digit gains in revenue and earnings in 2016 and 2017," the firm said in an analyst note.
The United Kingdom-based vehicle component manufacture company provides electrical and electronic, powertrain and safety solutions to the automotive and commercial vehicle markets.
Shares of Delphi Automotive are gaining by 2.28% to $86.64 at the start of trading on Wednesday.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate DELPHI AUTOMOTIVE PLC as a Buy with a ratings score of A-. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, compelling growth in net income and notable return on equity. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- DELPHI AUTOMOTIVE PLC has improved earnings per share by 23.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, DELPHI AUTOMOTIVE PLC increased its bottom line by earning $4.36 versus $3.89 in the prior year. This year, the market expects an improvement in earnings ($5.20 versus $4.36).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Auto Components industry average. The net income increased by 32.5% when compared to the same quarter one year prior, rising from $305.00 million to $404.00 million.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Auto Components industry and the overall market, DELPHI AUTOMOTIVE PLC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 9.3%. Since the same quarter one year prior, revenues slightly dropped by 3.5%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- You can view the full analysis from the report here: DLPH