Why Superior Industries Shares Dropped

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What: Shares of Superior Industries (NYSE: SUP  ) were looking anything but good today, falling as much as 14% on a disappointing earnings report.

So what: The aluminum-wheel manufacturer said it earned just $0.10 a share, on expectations of $0.25, and revenues fell 3.1%, to $210 million. This was due to a drop in average selling price due to lower aluminum prices. Superior also announced plans to build a new manufacturing facility in Mexico "to expand capacity and meet anticipated growth in demand."

Now what: As we've seen with Alcoa's troubles, now is not a good time to be in the aluminum business. The supply glut from China, and the generally slow worldwide economy, has also forced down prices. I'd wait for the commodity weakness to dissipate before getting on board.

Don't miss the next update on Superior Industries.

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  • Report this Comment On March 01, 2013, at 9:41 PM, meyejim wrote:

    The reason the stock dropped is because they missed, and worse they plan to chew up the $8 per share cash by expanding their low margin business.

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Related Tickers

9/27/2016 4:02 PM
SUP $29.07 Up +0.14 +0.48%
Superior Industrie… CAPS Rating: **