Have you looked into how American Axle & Manufacturing (AXL) performed internationally during the quarter ending September 2024? Considering the widespread global presence of this maker of auto parts, examining the trends in international revenues is essential for assessing its financial resilience and prospects for growth.

In the current era of a tightly interconnected global economy, the proficiency of a company to penetrate international markets significantly influences its financial health and trajectory of growth. For investors, the key is to grasp how reliant a company is on overseas markets, as this provides insights into the durability of its earnings, its ability to exploit different economic cycles, and its overall growth capabilities.

International market involvement serves as insurance against economic downturns at home and enables engagement with economies that are growing more quickly. Still, this move toward diversification is not without its challenges, as it involves navigating through the fluctuations of currencies, geopolitical threats, and the distinctive nature of various markets.

Our review of AXL's last quarterly performance uncovered some notable trends in the revenue contributions from its international markets, which are commonly analyzed and tracked by Wall Street experts.

The company's total revenue for the quarter amounted to $1.5 billion, marking a decrease of 3% from the year-ago quarter. We will next turn our attention to dissecting AXL's international revenue to get a clearer picture of how significant its operations are outside its main base.

Unveiling Trends in AXL's International Revenues

During the quarter, Europe contributed $218.7 million in revenue, making up 14.53% of the total revenue. When compared to the consensus estimate of $197.9 million, this meant a surprise of +10.51%. Looking back, Europe contributed $233.6 million, or 14.31%, in the previous quarter, and $233.1 million, or 15.02%, in the same quarter of the previous year.

Of the total revenue, $155.4 million came from Asia during the last fiscal quarter, accounting for 10.33%. This represented a surprise of +8.5% as analysts had expected the region to contribute $143.23 million to the total revenue. In comparison, the region contributed $149.1 million, or 9.13%, and $146.8 million, or 9.46%, to total revenue in the previous and year-ago quarters, respectively.

South America accounted for 3.04% of the company's total revenue during the quarter, translating to $45.8 million. Revenues from this region represented a surprise of -0.22%, with Wall Street analysts collectively expecting $45.9 million. When compared to the preceding quarter and the same quarter in the previous year, South America contributed $42.7 million (2.62%) and $50 million (3.22%) to the total revenue, respectively.

Prospective Revenues in International Markets

Wall Street analysts expect American Axle to report a total revenue of $1.45 billion in the current fiscal quarter, which suggests a decline of 0.9% from the prior-year quarter. Revenue shares from Europe, Asia and South America are predicted to be 13.2%, 9.9% and 2.3%, corresponding to amounts of $190.81 million, $143.46 million and $33.39 million, respectively.

For the entire year, the company's total revenue is forecasted to be $6.21 billion, which is an improvement of 2.1% from the previous year. The revenue contributions from different regions are expected as follows: Europe will contribute 14% ($868.11 million), Asia 9.5% ($586.49 million) and South America 2.6% ($158.49 million) to the total revenue.

Key Takeaways

Relying on international markets for revenues, American Axle faces both prospects and perils. Thus, tracking the company's international revenue trends is essential for accurately projecting its future trajectory.

In an era of growing international interdependencies and escalating geopolitical disputes, Wall Street analysts are vigilant in tracking these trends for businesses with a global reach, in order to refine their predictions of earnings. It should be noted, however, that a multitude of other elements, such as a company's domestic position, also play a significant role in shaping the earnings forecasts.

Here at Zacks, we put a great deal of emphasis on a company's changing earnings outlook, as empirical research has shown that's a powerful force driving a stock's near-term price performance. Quite naturally, the correlation is positive here -- an upward revision in earnings estimates drives the stock price higher.

The Zacks Rank, our proprietary stock rating tool, comes with an externally validated impressive track record. It effectively utilizes shifts in earnings projections to act as a dependable barometer for forecasting short-term stock price trends.

At present, American Axle holds a Zacks Rank #3 (Hold). This ranking implies that its near-term performance might mirror the overall market movement. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Assessing American Axle's Stock Price Movement in Recent Times

The stock has increased by 10.4% over the past month compared to the 4.4% rise of the Zacks S&P 500 composite. Meanwhile, the Zacks Auto-Tires-Trucks sector, which includes American Axle, has increased 16% during this time frame. Over the past three months, the company's shares have experienced a gain of 6.6% relative to the S&P 500's 13.1% increase. Throughout this period, the sector overall has witnessed a 27.4% increase.

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