Magna Surges to Record High on Sales Outlook: Toronto MoverEric Lam
Magna International Inc., North America’s largest auto-parts maker, rose to a record after increasing its 2013 sales forecasts and posting earnings that beat analysts’ estimates.
Magna climbed 3.6 percent to C$65.46 at 4 p.m. in Toronto, the highest since at least September 1988, according to data compiled by Bloomberg. The stock has jumped 32 percent this year.
“European margins look like the biggest positive area,” David Tyerman, a Toronto-based analyst at Canaccord Financial Inc, said in a research note today. “This is a very strong performance given the weakness in the European auto industry.”
Tyerman, who rates Magna a buy with a $64 target, said that may reflect Magna’s exposure to stronger companies such as Daimler AG, maker of Mercedes-Benz, Bayerische Motoren Werke AG and Volkswagen AG.
Magna raised its 2013 revenue expectations to $32.6 billion to $34 billion, compared with an earlier forecast of $32 billion to $33.4 billion in March. Magna now expects its operating margin will be in the mid-to-high 5 percent range, compared with earlier estimates of mid 5 percent.
Magna reported first-quarter net income of $1.57 a share compared with $1.46 a year earlier and ahead of the $1.45 average of nine estimates compiled by Bloomberg. Sales rose 9.1 percent to a record $8.36 billion from the year-ago quarter.