Shares of ARB Corporation Ltd (AU:ARB) spiked 10% today to hit a fresh 52-week high of AU$40.43 this morning following a solid half-yearly results announcement. ARB’s net profits jumped 8.1% year-over-year to AU$51.3 million for the six months ending December 31, 2023. Thanks to the robust performance, the company’s board proposed a 6.3% increase to its interim dividend to reach AU$0.34 per share.
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ARB Corp is an Australian after-market vehicle parts manufacturer with operations across Victoria, Australia, and Rayong, Thailand. The company witnessed a slowdown in demand in the Fiscal second quarter owing to industrial disputes in Australian ports.
Details About ARB’s Results
Sales revenues for the six months grew marginally by 0.2% at AU$341.55 million. ARB’s exports declined by 13.6% year-over-year due to changing market dynamics in key international markets.
In contrast, sales to original equipment manufacturers (OEM) grew by 53.8% year-over-year, thanks to growing momentum from existing contracts, new vehicle launches, and vehicle availability. Also, Australian Aftermarket sales rose 3.7% compared to the prior-year period.
Looking ahead, management is optimistic about the company’s growth, as it witnessed a return to normalcy in January, mainly as Australian ports resolved the issues. Plus, the company boasts of a robust customer order book, growing partnerships with OEMs, and the expectations of new product launches in 2024.
Is ARB a Good Stock to Buy?
With only one Hold rating received during the past three months, ARB stock has a Hold consensus rating on TipRanks. The ARB Corporation Ltd share price target of AU$35.99 implies 8.5% downside potential from current levels.
