Superior Industries Beats - Analyst Blog

Superior Industries International Inc. (SUP) showed a profit of $10.4 million or 39 cents per share during the third quarter of 2010 in contrast to a loss of $12.7 million or 48 cents per share in the same quarter of 2009. The profit, which was slightly ahead of the Zacks Consensus Estimates by 2 cents per share, was driven by an impressive rise in shipments.

Consolidated sales surged 65% to $183.7 million from $111.4 million a year ago. Shipments rose 45%, contributing $49.5 million to the increase in sales, while the higher pass-through pricing of aluminum contributed $18.7 million to the same. Average selling prices hiked 14.4% from the prior year period.

Unit shipments to Ford Motor Co. (F) rose 31%, General Motors (MTLQQ) increased 36%, Chrysler shot up 65% and to international customers jumped 75%.

Gross profit increased more than fourfold to $19.7 million (10.7% of sales) from $4.2 million (3.8% of sales) in the third quarter of 2009. The company's operating income was $11.4 million (6.2% of sales) versus a loss of $1.5 million (1.4% of net sales) in the year-ago quarter.

Superior Industries had cash, cash equivalents and short-term investments of $136 million as of September 26, 2010 compared with $137.7 million in the year-ago period. The company has no bank or other interest bearing debt in the period under consideration. The company's shareholder equity increased $10.96 million to $388.4 million as of the above date.

Superior Industries has a product portfolio geared to suit current market trends. We appreciate the company's effort to maintain a debt-free balance sheet. We also appreciate the company's sale of its 50% ownership in loss making Suoftec joint venture in June this year. These have led the company to retain Zacks #1 Rank (Strong Buy) on its stock for the short term.