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What: Shares of Harman International Industries (NYSE:HAR) were getting pumped up today, closing 13% higher after posting a strong first-quarter earnings report.
So what: The diversified electronics maker delivered per-share earnings of $0.95, ahead of estimates of $0.84, while revenues jumped 17%, to $1.17 billion, topping expectations of $1.1 billion. The sales gain was driven by increases in the Infotainment division, which encompasses the company's automotive audio products, and all three of the company's divisions showed double-digit sales increases. The maker of JBL and other speaker brands also began a new restructuring program in Germany that's expected to save the company $25 million annually by 2015 as it makes strides on both ends of the income statement.
Now what: Harman has been a big winner of late as shares have doubled since April, and are up over 700% after bottoming out following the financial crisis. The company seems to be firing on all cylinders as it recently secured $1.3 billion in contracts with various automakers, and figures to keep building profits as the auto market comes back at home and in Europe. Given those factors, and a reasonable P/E of 25, it's hard to see why shares wouldn't continue to move higher.
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