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What:Shares of Cooper Tire & Rubber Co were down 9.5% as of 10 a.m. EST Monday after the company announced mixed fourth-quarter results. By 12:45 p.m., the stock had moved back up from the morning's lows and was down about 6% from the previous close.
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So what:Quarterly revenue fell 5% year over year to $820 million, with the decrease primarily due to lower volume related to the absence of its 65% stake in its CCT joint venture in China sold during the quarter. Net income came in at $82 million, or $1.39 per share, including a $56 million gain net of tax from the sale of that joint venture. Excluding that gain, earnings would have been $0.45 per share. Analysts, on average were expecting lower sales of $804 million to translate to higher adjusted earnings of $0.64 per share.
Now what:Cooper didn't provide specific guidance for revenue or earnings, but CEO Roy Armes did elaborate that they expect tire markets to "grow modestly in North America." He went on, "In the Americas segment, while the early part of the year is likely to be negatively affected by the pre-buying we saw ahead of the tariff announcements, we expect to continue our strong performance for the full year."
Meanwhile, Armes noted Asia is growing in the high single-digit range, and said the company intends to invest there to expand its business after the sale of CCT.
All told, despite its expected near-term weakness, Cooper Tire's business seems to be chugging along as expected. So while I'm still not personally intrigued enough to dive in myself, I see nothing in this quarterly report that should alarm existing long-term shareholders.
The article Why Cooper Tire & Rubber Co Stock Dropped Today originally appeared on Fool.com.
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