Magna International ( NYSE: MGA ) stock slid sharply on Tuesday after the company tempered margin forecasts.
In an earnings preannouncement released prior to the market open, management projected 2022 sales to reach $37.8B for 2022, in the middle of the prior guidance of $37.4B to $38.4B and in-line with analyst estimates. Adjusted EBIT margin forecasts were reduced, however, to 4.3% from a prior 4.8% to 5% guide offered in November.
The company blamed decreased contribution on lower sales, higher net warranty costs,, operating underperformance at certain facilities, and labor inefficiencies, among other factors, for the trimmed guidance. Adjusted net income is due to fall below prior expectations due to the same pressures, though an estimated figure to be reported in mid-February was not offered.
Shares of the Canadian parts manufacturer fell 8.57% on Tuesday’s market open.
Dig into the details of the preannouncement .
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Magna stock slumps after management reels in margin forecast