Navistar Falls Most in 6 Months on Loss, Cash-Flow Forecast

Navistar International Corp. (NAV), the truckmaker that has Carl Icahn as one of its biggest investors, fell the most in six months after reporting a quarterly loss that was wider than some analysts had estimated.

The shares tumbled 5.8 percent to $37.16 at the close in New York, for the biggest decline since June 20. The stock has added 71 percent this year.

Navistar recorded a net loss of $154 million, or $1.91 a share, for the fourth quarter ended Oct. 31, compared with a loss of $2.77 billion, or $40.13, a year earlier, when the company’s results included non-cash tax expense of $2 billion, according to a statement. Analysts had estimated a loss of $1.56, on average.

The company, which has posted losses for each of the last five quarters, reached an agreement in July letting activist shareholders Icahn and Mark Rachesky nominate two directors to the board. In return they agreed not to wage a proxy battle against the Lisle, Illinois-based truckmaker. Today Navistar forecast lower earnings before interest, taxes, depreciation and amortization, or Ebitda, and a decline in cash for the first quarter.

The forecast “elevates concerns and limits upside until volume recovers and margins improve” David Leiker, an analyst with Robert W. Baird & Co., wrote in a note. That’s not likely until “late 2014 or even 2015,” said Leiker, who rates the shares hold.

Navistar said it expects to end the first quarter with cash and marketable securities of as much as $1.1 billion, compared with $1.52 billion at the end of the most recent three months.

Fourth-quarter revenue fell 13 percent to $2.75 billion, the company said. That compared with a $2.95 billion median estimate from analysts compiled by Bloomberg.

To contact the reporter on this story: Niamh Ring in New York at nring@bloomberg.net

To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net

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