Stocks Rise While Sales Fall For Fiat Chrysler
Fiat Chrysler is among the most popular automakers around the globe. Ranking in the top ten largest automobile manufacturers, Fiat Chrysler enjoys great sales. However, the past few months have not been the best for the multinational corporation.
This is actually a perplexing factor for many. The fact that the company is not making good sales in the United States automotive market was to be the driver of lessening stocks of the company. On the contrary, despite the deteriorating sales in the US market, Fiat Chrysler’s stocks rose. Let’s dig in and discover what happened and how.
Last Quarter of 2016
In the beginning of 2017, Fiat Chrysler released its sales figures for the last quarter of 2016. The reports revealed that the adjusted earnings per share ratio of the company remained strong with $0.29. This figure was a staggering 68% greater than what the company had in the fourth quarter of 2015.
A lot of experts and pro investors believe that the reason why the multinational company saw a rise in stocks regardless of its recent performance was simple. Investors must have taken into account the performance of the company in the last quarter, and would have remained optimistic. In addition to the elevating profitability of the company, its improving debt is also thought of as a factor that played a huge role.
The Current Scenario
Fiat Chrysler has had an all-time high price of $11.20. Last Friday, it was almost certain that the company would soon set a new record as it settled for $11.08. This is great because the company is currently trading higher than its expected 200-day average.
The Fall in Sales
Now that you have a brief idea about how the stocks might have risen, let’s go through how the sales of Fiat Chrysler fell. To start off, the fall was quite steep. In February 2017, the automaker sold a mere 168,326 units in the United States automotive market. This marked a mind-boggling fall of 10% as compared to the number of units sold in February 2016.
The Good!
Just like the stocks, a few other things also went uphill for the company. For instance, the sales of the company’s Ram truck rose by 4% as compared to the sales in the same month in 2016. Furthermore, the sales of Fiat Chrysler’s infamous Alfa Romeo also saw a year on year increase which was astonishing. The company sold 443 units of Alfa Romeo this February as opposed to a mere 47 in February 2016.
But then again, these segments, for any automotive company, are in general more profitable than others. However, experts believe that this increase in certain segments of Fiat Chrysler might have also played a major role in its stock hype.
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Sources
http://marketrealist.com/2017/03/fiat-chrysler-stock-rose-despite-lower-us-sales/
http://marketrealist.com/2017/01/who-were-the-outliers-in-the-consumer-space-on-january-27/
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