Lear Corp. (LEA) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

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Comparison

Company

Score

Quality

Valuation

Financial

Technical

Visteon Corp.

Autoliv, Inc.

Gentex Corp.

Donaldson Co., Inc.

Lear Corp.

Brunswick Corp.

Dana, Inc.

Allison Transmission Holdings, Inc.

Adient plc

Fox Factory Holding Corp.

Aptiv Plc

Why is Lear Corp. ?

High Management Efficiency with a high ROCE of 12.45%

Strong ability to service debt as the company has a low Debt to EBITDA ratio of 1.23 times

Flat results in Jun 25

OPERATING CASH FLOW(Y) Lowest at USD 1,032 MM
ROCE(HY) Lowest at 9.51%
CASH AND EQV(HY) Lowest at USD 1,688.1 MM

With ROCE of 14.91%, it has a very expensive valuation with a 1.08 Enterprise value to Capital Employed

The stock is trading at a discount compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of 10.22%, its profits have fallen by -7.6%
At the current price, the company has a high dividend yield of 350.1

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Lear Corp. should be less than 10%
Overall Portfolio exposure to Auto Components & Equipments should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Auto Components & Equipments)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Lear Corp. for you?

Medium Risk, Low Return

Absolute

Risk Adjusted

Volatility

Lear Corp.

7.87%

-0.32

34.30%

S&P 500

13.22%

0.64

20.20%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

6.70%

EBIT Growth (5y)

17.08%

EBIT to Interest (avg)

8.23

Debt to EBITDA (avg)

1.23

Net Debt to Equity (avg)

0.46

Sales to Capital Employed (avg)

2.98

Tax Ratio

27.52%

Dividend Payout Ratio

34.34%

Pledged Shares

Institutional Holding

100.00%

ROCE (avg)

12.45%

ROE (avg)

12.45%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

1.11

EV to EBIT

7.21

EV to EBITDA

4.49

EV to Capital Employed

1.08

EV to Sales

0.32

PEG Ratio

Dividend Yield

350.08%

ROCE (Latest)

14.91%

ROE (Latest)

14.71%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

Mildly Bullish

RSI

No Signal

Bollinger Bands

Bullish

Moving Averages

Bullish (Daily)

KST

Mildly Bearish

Mildly Bullish

Dow Theory

Mildly Bearish

OBV

Mildly Bullish

Mildly Bearish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

6What is working for the Company

INTEREST COVERAGE RATIO(Q)

Highest at 1,762.5

RAW MATERIAL COST(Y)

Fallen by -12.29% (YoY

NET SALES(Q)

Highest at USD 6,030.4 MM

OPERATING PROFIT(Q)

Highest at USD 437.1 MM

EPS(Q)

Highest at USD 3.06

-7What is not working for the Company

OPERATING CASH FLOW(Y)

Lowest at USD 1,032 MM

ROCE(HY)

Lowest at 9.51%

CASH AND EQV(HY)

Lowest at USD 1,688.1 MM

INVENTORY TURNOVER RATIO(HY)

Lowest at 12.5 times

DEBTORS TURNOVER RATIO(HY)

Lowest at 5.27 times

Here's what is working for Lear Corp.

Interest Coverage Ratio

Highest at 1,762.5

in the last five periods

MOJO Watch

The company's ability to manage interest payments is improving

Operating Profit to Interest

Net Sales

Highest at USD 6,030.4 MM

in the last five periods

MOJO Watch

Near term sales trend is positive

Net Sales (USD MM)

Operating Profit

Highest at USD 437.1 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is positive

Operating Profit (USD MM)

EPS

Highest at USD 3.06

in the last five periods

MOJO Watch

Increasing profitability; company has created higher earnings for shareholders

EPS (USD)

Raw Material Cost

Fallen by -12.29% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales

Here's what is not working for Lear Corp.

Operating Cash Flow

Lowest at USD 1,032 MM

in the last three years

MOJO Watch

The company's cash revenues from business operations are falling

Operating Cash Flows (USD MM)

Cash and Eqv

Lowest at USD 1,688.1 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is deteriorating

Cash and Cash Equivalents

Inventory Turnover Ratio

Lowest at 12.5 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling inventory has slowed

Inventory Turnover Ratio

Debtors Turnover Ratio

Lowest at 5.27 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio