$MGA

Magna International (MGA) fell 7.19% after Trump threatened 50% tariffs on Canadian vehicles and parts. Ford (F), Stellantis (STLA), and GM also declined. Magna, with high Canadian exposure, thin margins, and a beta of 1.86, is most vulnerable. Ford has negative earnings, high debt, and significant Canadian operations. GM has high leverage but less direct exposure. Stellantis, already down 54% YTD, has lower direct exposure but faces broader macro risks.

The U.S. imposed 50% tariffs on Canadian imports, risking a trade war. Sectors like automotive, aluminum, and energy are vulnerable due to integrated supply chains. Companies like Magna International (MGA), Teck Resources (TECK), Suncor Energy (SU), and Imperial Oil (IMO) face exposure, while U.S. producers like Nucor (NUE) may benefit. Morgan Stanley suggests potential tariff reductions but warns of margin impacts.

Magna International (TSX:MG) raised its full-year guidance for margins, EPS, and free cash flow but lowered sales outlook due to currency and divestitures. The company is expanding into robotics, automation, and data centers. Recent share buybacks and upgraded guidance highlight management's focus on profitability and capital returns. Analysts project $44.4B revenue and $1.9B earnings by 2029, with risks including volume and mix pressures in key regions and EV programs.

Magna (MGA) expects margin expansion and 20% EPS growth by 2026, driven by operational improvements and digital initiatives, despite flat auto production. The company is also pursuing non-auto opportunities in robotics and data centers. Magna's order book is solid, with 90% of business booked through 2028, and it plans to provide more details at its Investor Day on Nov. 11.

President Trump paused new 50% U.S. tariffs on Canadian goods, potentially benefiting Magna International (MGA), Constellation Brands (STZ), and Canadian Pacific Kansas City (CP). MGA reported strong Q2 earnings, STZ faces input cost pressures, and CP saw revenue growth. A deal could reduce tariffs, impacting these companies' costs and volumes.

The Crown is appealing a mistrial in Frank Stronach's sexual assault conviction, arguing the judge erred in declaring it based on emails presumed to be privileged. Stronach, founder of Magna International, was convicted of sexual assault and indecent assault in June. The Crown seeks to restore the guilty verdict and proceed with sentencing. Stronach's lawyer calls the appeal a waste of resources and politically motivated.

Magna (MGA) reported Q2 2026 sales of $11.0B, up 3% year over year, and adjusted EPS of $1.86, up 29%. Adjusted EBIT rose 16% to $677M and margin expanded to 6.2%. Free cash flow was $617M. Full-year guidance raised: sales $41.3B to $42.5B, adjusted EPS $6.70 to $7.30, and FCF $1.75B to $1.85B.

Canadian stocks fell into the Civic Holiday weekend. The TSX closed Friday at 35,226.14, down 279.7 points for the day and 0.4% for the week. Telus dropped 11.5% after a Q2 loss and a dividend cut. Eldorado Gold fell 3.5% and Magna raised its profit forecast after a Q2 beat. In the US, major averages rose Friday; Apple fell over 9% and Amazon gained 11%.

FactSet says about 75% of S&P 500 firms beat EPS estimates, but only about 60% beat revenue expectations. LSEG research finds earnings forecasts get more accurate as results near, so large surprises are rarer. The article lists nine Q2 companies with notable EPS beats, including HOWL, ABR, PWP, CRI, NWL, MOG-A, MGA, LYB, and NVT, with EPS and beat amounts cited.

Magna International reported Q2 2026 results after the close, with EPS of $1.86 versus an estimated $1.53, a 21.6% beat, and revenue of $10.98B versus $10.74B expected, up 2.2%. The company attributed the outperformance to operational discipline and margin expansion and raised full-year guidance, citing confidence in execution amid weaker global vehicle production.