Cooper Tire shares up 8% premarket as profit beat offsets sales miss

Cooper Tire & Rubber Co. shares soared about 8% in premarket trade Monday, after the company trounced profit estimates for the third quarter, offsetting a sales miss. Findlay, Ohio-based Cooper said it had net income of $29 million, or 58 cents a share, in the quarter, down from $54 million, or $1.07 a share, in the year-earlier quarter. Sales rose 4.5% to $704 million. The FactSet consensus was for EPS of 47 cents and sales of $737 million. "Despite the continued impact of tariffs, we were pleased to deliver sequential operating profit margin improvement in the third quarter driven by positive trends in pricing, mix and raw materials," Chief Executive Brad Hughes said in a statement. "As expected, our volume was impacted by customer inventory actions in the U.S., as well as challenging market conditions in our other regions." Sales were weighed down by lower unit volume and the effect of the strong dollar, the company said. Operating profit was hit by higher costs stemming from new tariffs on goods imported from China, the company said. "Cooper expects fourth quarter operating profit margin to improve sequentially, with full year operating profit margin slightly above the 5.9 percent we reported for full year 2018, driven by positive trends in pricing, mix and raw materials," said Hughes. Shares have fallen 11% in 2019 through Friday, while the S&P 500 has gained about 21%.

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