For Immediate Release
Chicago, IL – December 3, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Ford (F), Toyota (TM), Honda (HMC), Nissan (NSANY) and Automatic Data Processing (ADP).
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Here are highlights from Wednesday’s Analyst Blog:
U.S. Auto Sales Reach Bottom?
The U.S. auto industry posted a flat November sales at 742,925 vehicles compared to the year-ago level, suggesting the market has bottomed. The seasonally adjusted rate was 10.9 million vehicles compared 10.4 million vehicles in November last year. Sales of cars and light trucks dipped 3% to 566,365 vehicles.
Automakers tried to regain sales through discounts and higher sales incentives. According to the auto information website Edmunds.com, sales incentives increased 2% to $2,713 per vehicle during the month. However, this has not proved very helpful in melting the ice. The high unemployment rate was cited as the primary factor behind the lagging sales.
Among the U.S. automakers, Ford (F) succeeded in sustaining a strong position in the market by posting flat sales at 122,846 vehicles during November. The automaker’s sales of crossovers, which imitates SUVs but with a higher fuel-efficiency, grew 26%. Its car sales rose 14%, driven by a fuel-efficient product line. However, sales of trucks and SUVs posted double-digit declines on account of a deteriorated construction industry conditions and fuel-inefficiency, respectively.
Sales at General Motors fell 2% to 151,427 vehicles. However, four of its core brands — Buick, Cadillac, Chevrolet and GMC — performed well. Chrysler sales were lagged with a 25% decline to 63,560 vehicles, despite an array of sales incentives, including zero percent financing and cash rebates offered by the automaker.
Toyota (TM) showed a 2.6% rise in sales to 133,700 vehicles in the U.S. helped by popular models including Camry (up 18% 27,385 vehicles), RAV4 crossover (up 35.1% 11,512 vehicles) and Prius (up 11% to 9,617 vehicles). Hyundai sales shot up 46% on the back of its top-selling fuel-efficient and low-cost sedan, Sonata.
Honda (HMC) recorded a 2.9% decline in sales to 74,003 vehicles driven by poor sales of Civic (23% decline) and the Fit (27% decline). Sales at Nissan (NSANY) were up 21% to 56,288 vehicles after declining for the past three months. Some of its vehicles, which showed significant sales increases, included Maxima (83.8%), Altima (43.1%), Frontier (71.4%) and Xterra (50.9%).
We believe the U.S. automotive market will gain its momentum next year as many automakers are projecting positive views by announcing production increases. However, we need to wait for a drop in the unemployment rate to support the revamped inventories.
ADP Sees 169,000 Jobs Lost
The National Employment Report by Automatic Data Processing (ADP), the largest processor of private sector payrolls, indicates that the economy lost 169,000 jobs in November. While that is an improvement over both the 190,000 jobs lost in October as reported by the Bureau of Labor Statistics (BLS) and the 195,000 that ADP now says the economy lost in October (revised from a loss of 203,000), it is far more than consensus expectations of a loss of only 100,000 jobs for the month.
Job losses were widespread and roughly equally split between the service sector, which shed 81,000 jobs, and the goods-producing sector, which lost 88,000 jobs, according to ADP. The jobs lost in goods producing were equally split with construction and manufacturing both dropping 44,000.
Given that the service sector is far larger, with a total of 89.959 million people working in it, while the goods producing sector employs just 18.197 million, the goods producing sector continues to be hit much harder on a percentage basis. On the other hand, a decline of 44,000 jobs in manufacturing is actually the smallest drop in that area since May of 2008. However, this data seems at odds with the ISM data that came out yesterday, which pointed to a small increase in manufacturing employment in both October and November, with November’s decline being smaller than October’s.
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