TRW Automotive Beats JP Morgan's 4Q EPS Estimates $1.72 vs. $1.10

JP Morgan has published a research report on TRW Automotive TRW after the company reported a 4Q EPS beat of $1.72 vs. JP Morgan's estimate of $1.10. In the report, JP Morgan writes "Even after adjusting for a lower-than-expected tax rate (16% vs. JPMe of 32%), underlying EPS still seem like they were a healthy beat (TRW's tax rate has consistently come in lower than expected in recent quarters). But the highlight of the quarter was the substantial de-levering of both net debt and pension/OPEB obligations, which collectively adds about $4-5 per share of value relative to JPM's earlier expectations for year-end liabilities. The company only provided 2011 revenue guidance of $14.9-15.3B (JPMe $14.6B, though our estimate was admittedly overly conservative). No formal margin/earnings guidance provided, but we expect conference call commentary to directionally not guide for much if any EBIT margin expansion (i.e., engineering costs, launch costs, etc.), but some of this likely reflects typical management conservatism." JP Morgan maintains its Overweight rating on TRW Automotive, which closed yesterday at $59.64.