Opinions
Gordon Reid
Lear Corp.
LEA-N
BUY
Sep 22, 2023
$132.730
Stock price when the opinion was issued
Automotive
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(A Top Pick Oct 03/18, Down 19%) He's disappointed with its performance, but he continues to buy it, because Lear is till doing good things. 62% of their business is outside America. They trade at a cheap 8x earnings and boast a free cash flow yield over 10%. This should be higher, but the whole sector is out of favour. Be patient.
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Are a tier-one supplier of car OEMs, making seating systems and advance power management. The car industry faces chip shortages, so Lear is effected by the number of units it can deliver to carmakers, but this backlog is starting to decline and normalization is happening. Another tailwind if that electrification will boost the power management business, which boasts high margins. Lear has a good 8% free cash flow. Buy, hold and be patient. (Analysts’ price target is $167.27)
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(A Top Pick Apr 21/23, Up 1%)
Auto parts, attuned to electrification. Very good operator. Not much going on in past year. Technology needs to catch up on EVs so that consumer fully buys in. Poised to do extremely well on margins and profitability. When the stars align, will see a lot of action here. Not if, but when.
Automotive
Electronics business growing rapidly.
Current share price under valued.
Aiming to grow profit by 50%.
Supply issues recovering from Covid-19 pandemic.
Good for long term investor.
Owns shares in the company.