How Did Investors React to Fiat Chrysler’s 2Q17 Earnings?
Fiat Chrysler’s 1Q17 earnings
Italian-American auto giant Fiat Chrysler Automobiles (FACU) announced its 2Q17 results on July 27. FCAU reported adjusted EPS (earnings per share) of 0.69 euros, or about $0.81, which is ~245% higher than its EPS in 2Q16 and also higher than the analysts’ estimate of 0.54 euros, or ~$0.62.
But before we look at Fiat Chrysler’s 2Q earnings’ key highlights, let’s take a look at the investor reaction on the day of the earnings release.
Interested in FCAU? Don't miss the next report.
Receive e-mail alerts for new research on FCAU
Fiat Chrysler stock fell
On the day of its 2Q17 earnings release, FCAU stock fell 0.6% and closed at $11.83. The drop in the company’s 2Q17 NAFTA (North American Free Trade Agreement) sales and market share are likely the primary reasons behind the stock fall. FCAU’s high dependence on the US market could be another key reason.
Meanwhile, FCAU’s profit margins improved in the second quarter, taking it closer to its 2018 targets. As of July 27, Fiat Chrysler stock has inched up by 30.3% in 2017 so far.
This YTD (year-to-date) performance is far better than those of direct peers (XLY) General Motors (GM), Ford Motor (F), and Toyota Motor (TM). Ford and Toyota have lost about 7.8% and 4.7% YTD, respectively, while GM stock has risen 3.2% YTD.
In this series, we’ll explore Fiat Chrysler’s 2Q17 revenues and profitability and discuss what key factors drove its earnings. We’ll also take a closer look at its progress toward its 2017 guidance and whether this progress could drive its stock higher for the rest of 2017.