Hyundai, Kia Decline After Earnings Miss Analysts’ Estimates: Seoul Mover
Hyundai Motor Co. and its smaller affiliate Kia Motors Corp. fell in Seoul trading after South Korea’s two biggest automakers reported fourth-quarter profits that missed analysts’ estimates.
Hyundai fell for a second day, slipping as much as 3.7 percent to 220,500 won at 10:44 a.m. on the Korea Exchange, while Kia dropped as much as 2.9 percent. Seoul-based Hyundai, maker of the Elantra sedan, yesterday reported net income that was about 10 percent below the average analyst estimate compiled by Bloomberg, while Optima-maker Kia today delivered profit that was 27 percent lower than the average estimate.
The share declines signal investors are betting that Hyundai and Kia, the two best performers on the Bloomberg World Auto Manufacturers Index in 2011, will fail to replicate their success this year as Toyota Motor Corp. and Honda Motor Co. recover from natural disasters in Japan and Thailand. This week, Honda President forecast Takanobu Ito forecast earnings will climb to the highest in at least five years and Toyota raised its sales forecast.
“There’s an underlying concern that Hyundai and Kia may not perform as well as they did last year,” said Lee Jin Woo, a fund manager at Seoul-based KTB Asset Management Co., which manages the equivalent of $3.6 billion in assets, including Hyundai and Kia shares. “This uncertainty will continue throughout the year, and each misstep will trigger the concern.”
Hyundai’s full-year net income rose 35 percent to 8.1 trillion won ($7.2 billion), more than the combined estimated earnings at Toyota and Nissan Motor Co. Still, the quarterly results missed estimates because of unexpected bonus payments at financial affiliate Hyundai Capital, Gregory Kim, an analyst at Mirae Asset Securities Co. in Seoul, said yesterday.
Kia, the maker of the Optima sedan and Rio compact, today delivered fourth-quarter net income, operating profit and revenue that missed average analyst estimates compiled by Bloomberg.
More Industry

First-Half Dealership Deals Up
Buy-sell activity shows that acquirers are looking for value and scale as many retailers seek to leave an increasingly competitive and complex market, Kerrigan Advisors reports.
Read More →
Kia Closes Out Summer With a Bang
Its U.S. subsidiary broke multiple records in August, in part due to a surge of demand for hybrids models.
Read More →
Indiana Dealership Changes Hands
A 30-year-old Ford dealership in Indiana has a new owner and will soon be undergoing renovations to meet manufacturer requirements.
Read More →
Texas Dealership No Longer in the Family
The Ford store, a longtime cornerstone of the Houston market, is now part of one of the fastest-growing U.S. auto groups.
Read More →
Genesis Grows California Presence
The Cardinale Automotive Group opened its third Genesis rooftop in the Golden State, Genesis of San Bruno, a stand-alone dealership serving the San Francisco Bay Area.
Read More →
August Auto Sales a Mixed Bag
An early forecast shows strong business despite consumer hurdles, and hybrids are a big piece of their affordability coping strategy.
Read More →
EV Market Humming Along
July sales show steady growth as the segment stabilizes from last year’s artificial surge following pullback of federal support.
Read More →
Auto Loan Delinquency Rates Stabilize
Auto loans are a main driver of nonmortgage consumer debt, but delinquency rates stabilized in the second quarter across all credit risk tiers.
Read More →
EV Sales Recover in Q2
The EV sales roller coaster continues as numbers show improvement, but industry experts predict a year-over-year third-quarter decline and fourth-quarter jump.
Read More →
The Cheapest Hybrids to Fuel
The powertrain is increasing in popularity, in no small part due to its fuel economy. A new report lists the most efficient hybrids on the market.
Read More →