Detroit Big Three automaker Chrysler definitely shifted into high gear for its first quarter.
Profits came to $473 million, up a spectacular 300% from the year-ago period’s $116 million and the company’s best quarter since Q3 1998, when it made $682 million.
If Chrysler can keep up the momentum, the company’s corporate parent, Fiat (PINK:FIATY), could get real serious real fast about spinning Chrysler off through an initial public offering. It would be a great way to generate some cash — something Fiat could use considering its mostly European-based business continues to lag. Those continental woes also have been shared by the other American automakers General Motors (NYSE:GM) and Ford (NYSE:F).
Much of the strength was in the U.S., where Chrysler’s sales shot up almost 40% for the quarter as its market share grew from 9.2% to 11.2% year-over-year. The company also saw positive results in Canada, and sales outside the U.S. boomed by 80%.
Chrysler’s continued strong performance might be enough to get IPO investors interested, but the company might want to consider holding off a little longer. General Motors has mostly struggled since its November 2010 IPO, its shares down 32% since then.
And while automaker stocks in general have had a decent run in 2012, Ford and GM each still remain down around 25% from a year ago, while Japanese automakers Toyota (NYSE:TM) and Honda (NYSE:HMC) have struggled to a respective 4% gain and 4% loss.
Tom Taulli runs the InvestorPlace blog IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of “The Complete M&A Handbook”, “All About Short Selling” and “All About Commodities.” Follow him on Twitter at @ttaulli or reach him via email. As of this writing, he did not own a position in any of the aforementioned securities.
A long-time follower of the IPO scene, back in 1999 Tom started one of the first sites in the space called WebIPO. It was a place where investors got research as well as access to deals for the dot-com boom. Tom also wrote the top-selling book, Investing in IPOs. In it, he covers all the aspects of analyzing an IPO, such as reading the prospectus, detecting the risk factors and understanding some of the arcane regulations. But don’t worry — if that process is too intimidating for you, thankfully Tom will do the legwork for you right here in the IPO Playbook blog.
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