The Earnings Scout: A Focus on the Auto Parts & Equipment Industry

August 1, 2013

Earnings Scout is a proprietary analysis of the rate of change (the delta) in earnings trend expectations. This analysis is differentiated as it identifies divergence of stock price from the rate of change future expectations. The rate of change is a leading indicator of a catalyst for potential price change not measured elsewhere. Contact info@roulstonresearch.com to learn more on how they can create tailored reports so you can maximize your risk-adjusted returns.

  • The auto parts & equipment industry in the S&P 500 consists of three companies: BorgWarner, Delphi and Johnson Controls.
  • The industry accounts for 0.11% of the S&P 500 index.
  • In 2012, the auto parts & equipment industry significantly underperformed the consumer discretionary sector (4.45% vs. 23.92%) and the S&P 500, which returned 16.00%.
  • In 2013, the industry is now outperforming the consumer discretionary sector (35.12% vs. 26.04%) and the S&P 500, which has a total YTD return of 19.62%.

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  • As we have sifted through all of the earnings reports over the past several quarters, we have noticed the positive trends within housing begin to wane, while anything tied to the auto industry has started to accelerate into more positive territory.
  • Based on the 2Q13 earnings reports and 3Q13 guidance, there is a great chance these positive trends will be sustained through the first half of 2014.

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