A significant driver of top-line growth: CNH Industrial N.V. (CNHI)

CNH Industrial N.V. (NYSE: CNHI) stock fell -1.26% on Friday to $11.79 against a previous-day closing price of $11.94. With 2.72 million shares changed hands, the volume of the stock remained lighter than its average volume of 3.59 million shares. During the session, the Farm & Heavy Construction Machinery company that operates in wider Industrials sector, reached to the highest price of $12.12 whereas the lowest price it dropped to was $11.78. The 52-week range on CNHI shows that it touched its highest point at $17.21 and its lowest point at $10.60 during that stretch. It currently has a 1-year price target of $15.53. With its current market cap of 16.76 billion, CNHI has annualized dividend of $0.30 while the current yield stands at 2.56%. Beta for the stock currently stands at 1.69.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of CNHI was down-trending over the past week, with a drop of -3.36%, but this was down by -3.68% over a month. Three-month performance dropped to -5.30% while six-month performance fell -28.68%. The stock lost -17.63% in the past year, while it has lost -30.56% so far this year. A look at the trailing 12-month EPS for CNHI yields 1.11 with Next year EPS estimates of 1.52. For the next quarter, that number is 0.32. This implies an EPS growth rate of 448.70% for this year and 9.69% for next year. EPS is expected to grow by 9.00% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 53.70%.

Float and Shares Shorts:

At present, 1.35 billion CNHI shares are outstanding with a float of 994.79 million shares on hand for trading. On Jul 14, 2022, short shares totaled 12.6 million, which was 0.93% higher than short shares on Jun 14, 2022. In addition to Ms. Suzanne Heywood as the firm’s Exec. Chairperson, Mr. Scott Wellington Wine serves as its CEO & Exec. Director.


Institutional Ownership:

Through their ownership of 50.84% of CNHI’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 6.05% of CNHI, in contrast to 38.03% held by mutual funds. Shares owned by individuals account for –. As the largest shareholder in CNHI with 7.13% of the stake, Harris Associates LP holds 96,534,929 shares worth 96,534,929. A second-largest stockholder of CNHI, Wellington Management Co. LLP, holds 42,964,699 shares, controlling over 3.17% of the firm’s shares. The Vanguard Group, Inc. is the third largest shareholder in CNHI, holding 24,565,509 shares or 1.81% stake. With a 2.42% stake in CNHI, the Oakmark International Fund is the largest stakeholder. A total of 32,731,123 shares are owned by the mutual fund manager. The Government Pension Fund – Global, which owns about 1.83% of CNHI stock, is the second-largest Mutual Fund holder. It holds 24,716,477 shares valued at 302.28 million. Artisan International Value Fund holds 1.45% of the stake in CNHI, owning 19,676,186 shares worth 240.64 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for CNHI since 21 analysts follow the stock currently. There are 11 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 7 believe that the stock is worth HOLDING, 3 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With CNHI analysts setting a high price target of $18.36 and a low target of $14.04, the average target price over the next 12 months is $15.96. Based on these targets, CNHI could surge 55.73% to reach the target high and rise by 19.08% to reach the target low. Reaching the average price target will result in a growth of 35.37% from current levels.


EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. CNHI will report FY 2022 earnings on 02/08/2023. Analysts have provided yearly estimates in a range of $1.44 being high and $1.22 being low. For CNHI, this leads to a yearly average estimate of $1.37. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. CNH Industrial N.V. surprised analysts by $0.07 when it reported $0.43 EPS against a consensus estimate of $0.36. The surprise factor in the prior quarter was $0.04. Based on analyst estimates, the high estimate for the next quarter is $0.34 and the low estimate is $0.29. The average estimate for the next quarter is thus $0.32.

Summary of Insider Activity:

Insiders traded CNHI stock several times over the past three months with 15 Buys and 0 Sells. In these transactions, 11,903 shares were bought while 0 shares were sold. The number of buy transactions has increased to 51 while that of sell transactions has risen to 1 over the past year. The total number of shares bought during that period was 490,413 while 18,570 shares were sold.

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