Standard Motor Buys Forecast Trading - Analyst Blog
10 November 2011 - 3:23AM
Zacks
Standard Motor Products
Inc. (SMP) recently announced that
it has acquired the full capital stock of Florida-based Forecast
Trading Corporation for an approximate price of $44
million.
Forecast is
a well-known supplier and distributor of value-priced engine
management products including ignition coils, ignition modules,
switches and sensors, and filters. The company’s distribution
facilities are primarily located in Fort Lauderdale,
Florida.
Forecast
boosts a strong track record of sourcing value-priced engine
management products from low-cost areas. As a result, Standard
Motor is expected to drive synergies based on the expertise of the
company in this space, and thus improving its financial results for
the upcoming quarters.
Moreover,
Standard Motor also believes that this acquisition will strengthen
its position as the leading supplier of Engine Management parts to
the aftermarket in a weak economy and an aging vehicle
population.
In the third
quarter of 2011, the company reported adjusted earnings of $13.7
million or 59 cents per share as against $9.8 million or 43 cents
per share in the year-ago quarter. Consolidated net sales in the
quarter grew 3.8% year over year to $236.2 million, driven by
improved performance of the Engine Management segment, partly
offset by lower sales from the Temperature Control
segment.
Revenues from the Engine Management segment escalated 7.6% to
$165.2 million, while revenues from the Temperature Control segment
amounted to $68.1 million.
The Long Island, New York-based Standard Motor, a Zacks #3 Rank
(Hold rating) stock, is one of the leading manufacturers,
distributors and marketers of automotive replacement parts in the
U.S. The company’s key competitors include Federal-Mogul
Corporation (FDML), Robert Bosch Corporation and
Visteon Corporation (VC).
The major competitive advantages of the company are its trained
sales force, extensive product range, sophisticated
parts-cataloging systems and effective inventory management.
FEDERAL MOGUL-A (FDML): Free Stock Analysis Report
STANDARD MOTOR (SMP): Free Stock Analysis Report
VISTEON CORP (VC): Free Stock Analysis Report
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