Will These 3 Auto Stocks Surpass Q4 Earnings Forecasts?

Core Insights - The fourth-quarter earnings season for the Auto-Tires-Trucks sector has shown mixed results, with Ford disappointing, General Motors exceeding estimates for the 14th consecutive quarter, and Tesla surprising with a significant capex plan exceeding $20 billion for the year [1] Industry Overview - The U.S. auto industry experienced a slowdown in the fourth quarter, with vehicle sales dropping to an annualized pace of 15.6 million units from 16.4 million in the third quarter, marking the weakest period of the year [3] - Tariffs on imported vehicles and components have increased costs for automakers, contributing to profitability pressures, while inflation has affected both manufacturers and consumers [4] - The electric vehicle market saw a significant decline in demand, with EV sales falling to 234,000 units in the fourth quarter, down 46% sequentially and 36% year-over-year [5] Company-Specific Insights Advance Auto Parts (AAP) - AAP is expected to report earnings with a consensus estimate of 43 cents per share, indicating a 136% year-over-year growth, while revenues are projected to decline by 2% to $1.95 billion [10] - The company has an Earnings ESP of -2.14% and a Zacks Rank of 3, suggesting uncertainty regarding an earnings beat [7] - AAP's comps growth is estimated at 2.23%, compared to a decline of 1% in the same quarter of 2024 [8] Magna International (MGA) - MGA is predicted to report earnings with a consensus estimate of $1.81 per share, reflecting a 7% year-over-year growth, while revenues are expected to decline by 1% to $10.5 billion [13] - The company has an Earnings ESP of +3.87% and a Zacks Rank of 3, indicating a favorable outlook for an earnings beat [11] - The Power & Vision segment is anticipated to contribute positively, with revenues expected to rise to $3,796 million from $3,786 million in the previous year [12] Dauch Corporation (DCH) - DCH is forecasted to report a loss of 7 cents per share, representing a 17% year-over-year deterioration, while revenues are expected to grow by 2% to $1.4 billion [16] - The company has an Earnings ESP of +124.47% but a Zacks Rank of 4, indicating challenges in achieving an earnings beat [15] - Management has highlighted several headwinds for the fourth quarter, including normal seasonality and production volatility [15]