Earnings Preview for Navistar International

Navistar International

is scheduled to report second-quarter fiscal 2011 results before the markets open on Tuesday, June 7. Investors will be watching to see whether the company will get back on track after disappointing first-quarter results and whether the recently faltering economy will have any effect on the truck maker's previously optimistic guidance. Analysts anticipate that the company will announce that earnings came to $1.17 per share. The consensus estimate was the same 60 days ago, and per-share earnings came in at $0.42 in the same period of last year. Navistar has topped consensus earnings estimates in three of the past four quarters, but missed by 7 cents per share in the first quarter.

During the three months that ended in April, the company received an order from the U.S. Army for troop transport vehicles to be used in Afghanistan and another for ambulances from the Marines. The revenue forecast for that period calls for an increase of 20.3% from the same period of last year to $3.3 billion. And sequential and year-over-year growth of revenues is projected for the current quarter as well.

Navistar International operates in four segments. The Truck segment makes and distributes trucks and buses for the common carrier and private carrier, military vehicles, and student and commercial transportation markets. The Engine segment designs and manufactures diesel engines for medium and heavy trucks, military vehicles and buses, as well as sells engines for industrial and agricultural applications. The Parts segment offers truck, trailer and engine service parts. The Financial Services segment provides retail, wholesale and lease financing services for its trucks and parts.

The long-term earnings per share growth forecast is 10.4%, the price-to-earnings ratio is less than the industry average, and the price/earnings-to-growth ratio is 0.9. Insiders bought more than 260,000 shares during the second quarter. Analysts on average recommend buying NAV and have for more than 90 days. Their mean price target is currently $77.87 per share. The share price ended last week at $63.36 after pulling back in recent weeks from a 52-week high of $71.49. Year to date, the stock has outperformed competitors Oshkosh

and PACCAR

, as well as the broader markets.