CNH Bets on Electric Trucks to Jumpstart Results

CNH Industrial (NYSE: CNHI) quietly builds trucks, tractors, farm and construction vehicles, buses, and even amphibious armored vehicles -- machines that keep modern life functioning but usually don't make splashy headlines. However, CNH recently inked a new partnership that might give it access to a battery technology breakthrough with revolutionary possibilities – if it lives up to current hype. That could lead to potentially electrifying results for CNH's future strategies and profits.

The sheer variety of vehicles produced across CNH's brand lineup helps buffer it against downturns that hit specialized companies harder. The company introduced 24 new vehicles and other products in Q1 2019 alone, hedging against unfavorable agriculture and construction sector pressures. Nevertheless, sector struggles have taken their toll on CNH, causing consolidated revenues for the first nine months of 2019 to drop 5.2% and adjusted EBITDA to decline 7.8% year-over-year.

While CNH is undergoing some troubles and isn't a red-hot stock, some signs hint it's still strong at its core, so taking the initiative could better its fortunes. For example, as a dividend stock, CNH posted an 18% payout ratio in its most recent quarter. This shows the company is rolling a solid percentage of its money back into strengthening and extending its business, a promising indicator of corporate health and good planning. And the company's latest bold, potentially profitable move could also help it recover from the 2016 downturn caused by Brexit.

Source Fool.com