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Daimler Declines On Weak Outlook

Daimler Declines On Weak Outlook
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German automaker Daimler AG (OTC: DDAIF) saw its shares tumble 5 percent on Thursday morning as investors remained wary of the company following a lackluster earnings report. While the firm confirmed that 2015 was a strong year, a warning that earnings and sales growth in the coming year are likely to fall short put traders off.

Poor Outlook

The biggest drag on Daimler shares was the company's warning about slower growth in 2016. The firm said that it expects growth in China to be slower this year, a big change from 2015 when Chinese sales rose 41 percent to become the firm's biggest market.

However, Chief Executive Dieter Zetsche said that the firm is still positive on its prospects in China and that he believes Daimler can achieve market share gains.

Related Link: Will Volkswagen Ever Come Out From Under Its Emissions Scandal?

Stellar Year

Daimler's earnings call wasn't all bad news— the company posted strong figures for 2015 with its return on sales rising 10 percent from the previous year and its EBIT gaining 36 percent. Not only that, but the firm proposed its highest ever dividend of €3.25 euros per share, a jump from last year's €2.45 dividend payment in 2014.

Moving Forward

Zetsche tried to reassure investors that 2016 could still bring about big things for Daimler, but that the company would have to work hard to achieve those goals in the current economic climate on the earnings call. However, investors appear to be unconvinced, as they abandoned the stock following the results, with worries about the overall auto industry compounding uncertainty surrounding the stock.

Image Credit: Public Domain

Posted-In: Earnings News Guidance Dividends Dividends Global Markets Movers


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