LEAR CORP (LEA) Stock Fundamental Analysis
NYSE:LEA - New York Stock Exchange, Inc. - US5218652049 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to LEA. LEA was compared to 81 industry peers in the Automobile Components industry. While LEA is still in line with the averages on profitability rating, there are concerns on its financial health. LEA has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year LEA was profitable.
In the past year LEA had a positive cash flow from operations.
In the past 5 years LEA has always been profitable.
In the past 5 years LEA always reported a positive cash flow from operatings.
1.2 Ratios
With a Return On Assets value of 3.27%, LEA is not doing good in the industry: 65.43% of the companies in the same industry are doing better.
With an excellent Return On Equity value of 10.25%, LEA belongs to the best of the industry, outperforming 87.65% of the companies in the same industry.
The Return On Invested Capital of LEA (8.77%) is better than 87.65% of its industry peers.
LEA had an Average Return On Invested Capital over the past 3 years of 8.42%. This is in line with the industry average of 8.96%.
The 3 year average ROIC (8.42%) for LEA is below the current ROIC(8.77%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.27% | ||
| ROE | 10.25% | ||
| ROIC | 8.77% |
ROA(3y)3.3%
ROA(5y)2.78%
ROE(3y)10.01%
ROE(5y)8.33%
ROIC(3y)8.42%
ROIC(5y)7.66%
1.3 Margins
Looking at the Profit Margin, with a value of 2.09%, LEA is doing worse than 66.67% of the companies in the same industry.
LEA's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 4.48%, LEA is doing worse than 70.37% of the companies in the same industry.
In the last couple of years the Operating Margin of LEA has declined.
LEA has a Gross Margin of 7.71%. This is amonst the worse of the industry: LEA underperforms 90.12% of its industry peers.
LEA's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.48% | ||
| PM (TTM) | 2.09% | ||
| GM | 7.71% |
OM growth 3Y-0.38%
OM growth 5Y-7.19%
PM growth 3Y3.85%
PM growth 5Y-10.6%
GM growth 3Y0.04%
GM growth 5Y-4.59%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so LEA is still creating some value.
Compared to 1 year ago, LEA has less shares outstanding
LEA has less shares outstanding than it did 5 years ago.
The debt/assets ratio for LEA is higher compared to a year ago.
2.2 Solvency
LEA has an Altman-Z score of 2.83. This is not the best score and indicates that LEA is in the grey zone with still only limited risk for bankruptcy at the moment.
LEA has a better Altman-Z score (2.83) than 65.43% of its industry peers.
LEA has a debt to FCF ratio of 5.78. This is a neutral value as LEA would need 5.78 years to pay back of all of its debts.
LEA has a Debt to FCF ratio of 5.78. This is in the lower half of the industry: LEA underperforms 66.67% of its industry peers.
LEA has a Debt/Equity ratio of 0.59. This is a neutral value indicating LEA is somewhat dependend on debt financing.
LEA has a Debt to Equity ratio of 0.59. This is in the lower half of the industry: LEA underperforms 77.78% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 5.78 | ||
| Altman-Z | 2.83 |
ROIC/WACC1.02
WACC8.63%
2.3 Liquidity
A Current Ratio of 1.32 indicates that LEA should not have too much problems paying its short term obligations.
LEA has a Current ratio of 1.32. This is amonst the worse of the industry: LEA underperforms 87.65% of its industry peers.
A Quick Ratio of 1.03 indicates that LEA should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.03, LEA is doing worse than 81.48% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.32 | ||
| Quick Ratio | 1.03 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 1.13% over the past year.
LEA shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -2.01% yearly.
LEA shows a decrease in Revenue. In the last year, the revenue decreased by -3.15%.
Measured over the past years, LEA shows a small growth in Revenue. The Revenue has been growing by 3.30% on average per year.
EPS 1Y (TTM)1.13%
EPS 3Y16.72%
EPS 5Y-2.01%
EPS Q2Q%-1.89%
Revenue 1Y (TTM)-3.15%
Revenue growth 3Y6.56%
Revenue growth 5Y3.3%
Sales Q2Q%-7.24%
3.2 Future
LEA is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.36% yearly.
LEA is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.41% yearly.
EPS Next Y-4.59%
EPS Next 2Y6.99%
EPS Next 3Y11.18%
EPS Next 5Y14.36%
Revenue Next Year-3.46%
Revenue Next 2Y0.02%
Revenue Next 3Y0.88%
Revenue Next 5Y2.41%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 7.61, the valuation of LEA can be described as very cheap.
LEA's Price/Earnings ratio is rather cheap when compared to the industry. LEA is cheaper than 81.48% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 24.95. LEA is valued rather cheaply when compared to this.
The Price/Forward Earnings ratio is 6.62, which indicates a rather cheap valuation of LEA.
Based on the Price/Forward Earnings ratio, LEA is valued a bit cheaper than 75.31% of the companies in the same industry.
LEA is valuated cheaply when we compare the Price/Forward Earnings ratio to 20.99, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.61 | ||
| Fwd PE | 6.62 |
4.2 Price Multiples
67.90% of the companies in the same industry are more expensive than LEA, based on the Enterprise Value to EBITDA ratio.
LEA's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.7 | ||
| EV/EBITDA | 4.31 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y6.99%
EPS Next 3Y11.18%
5. Dividend
5.1 Amount
LEA has a Yearly Dividend Yield of 3.25%.
LEA's Dividend Yield is comparable with the industry average which is at 4.24.
Compared to an average S&P500 Dividend Yield of 2.41, LEA pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.25% |
5.2 History
The dividend of LEA has a limited annual growth rate of 0.74%.
LEA has paid a dividend for at least 10 years, which is a reliable track record.
LEA has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)0.74%
Div Incr Years0
Div Non Decr Years3
5.3 Sustainability
LEA pays out 35.90% of its income as dividend. This is a sustainable payout ratio.
The dividend of LEA is growing, but earnings are growing more, so the dividend growth is sustainable.
DP35.9%
EPS Next 2Y6.99%
EPS Next 3Y11.18%
95.54
+0.7 (+0.74%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupAutomobiles & Components
GICS IndustryAutomobile Components
Earnings (Last)
Earnings (Next)
Inst Owners106.72%
Inst Owner Change2.03%
Ins Owners0.47%
Ins Owner Change20.86%
Market Cap5.12B
Analysts73.33
Price Target100.22 (4.9%)
Short Float %3.52%
Short Ratio2.34
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.25% |
Yearly Dividend3.14
Dividend Growth(5Y)0.74%
DP35.9%
Div Incr Years0
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)13.7%
Min EPS beat(2)12.95%
Max EPS beat(2)14.45%
EPS beat(4)4
Avg EPS beat(4)10.27%
Min EPS beat(4)4.89%
Max EPS beat(4)14.45%
EPS beat(8)7
Avg EPS beat(8)6.33%
EPS beat(12)11
Avg EPS beat(12)8.13%
EPS beat(16)13
Avg EPS beat(16)6.71%
Revenue beat(2)1
Avg Revenue beat(2)0.98%
Min Revenue beat(2)-0.35%
Max Revenue beat(2)2.32%
Revenue beat(4)1
Avg Revenue beat(4)-0.02%
Min Revenue beat(4)-1.26%
Max Revenue beat(4)2.32%
Revenue beat(8)4
Avg Revenue beat(8)0.37%
Revenue beat(12)8
Avg Revenue beat(12)0.76%
Revenue beat(16)10
Avg Revenue beat(16)0.67%
PT rev (1m)-17.65%
PT rev (3m)-21.33%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-15.65%
EPS NY rev (1m)-5.7%
EPS NY rev (3m)-8.71%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-4.3%
Revenue NY rev (1m)-0.13%
Revenue NY rev (3m)-2.82%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.61 | ||
| Fwd PE | 6.62 | ||
| P/S | 0.22 | ||
| P/FCF | 10.7 | ||
| P/OCF | 4.98 | ||
| P/B | 1.1 | ||
| P/tB | 1.74 | ||
| EV/EBITDA | 4.31 |
EPS(TTM)12.55
EY13.14%
EPS(NY)14.44
Fwd EY15.11%
FCF(TTM)8.93
FCFY9.34%
OCF(TTM)19.18
OCFY20.08%
SpS427.19
BVpS87.01
TBVpS54.82
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.27% | ||
| ROE | 10.25% | ||
| ROCE | 11.68% | ||
| ROIC | 8.77% | ||
| ROICexc | 9.63% | ||
| ROICexgc | 12.26% | ||
| OM | 4.48% | ||
| PM (TTM) | 2.09% | ||
| GM | 7.71% | ||
| FCFM | 2.09% |
ROA(3y)3.3%
ROA(5y)2.78%
ROE(3y)10.01%
ROE(5y)8.33%
ROIC(3y)8.42%
ROIC(5y)7.66%
ROICexc(3y)9.67%
ROICexc(5y)8.89%
ROICexgc(3y)12.82%
ROICexgc(5y)12%
ROCE(3y)11.21%
ROCE(5y)10.19%
ROICexcg growth 3Y3.48%
ROICexcg growth 5Y-8.63%
ROICexc growth 3Y4.84%
ROICexc growth 5Y-6.82%
OM growth 3Y-0.38%
OM growth 5Y-7.19%
PM growth 3Y3.85%
PM growth 5Y-10.6%
GM growth 3Y0.04%
GM growth 5Y-4.59%
F-Score4
Asset Turnover1.56
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 5.78 | ||
| Debt/EBITDA | 1.69 | ||
| Cap/Depr | 89.56% | ||
| Cap/Sales | 2.4% | ||
| Interest Coverage | 8.79 | ||
| Cash Conversion | 62.71% | ||
| Profit Quality | 100.04% | ||
| Current Ratio | 1.32 | ||
| Quick Ratio | 1.03 | ||
| Altman-Z | 2.83 |
F-Score4
WACC8.63%
ROIC/WACC1.02
Cap/Depr(3y)101.46%
Cap/Depr(5y)98.02%
Cap/Sales(3y)2.71%
Cap/Sales(5y)2.76%
Profit Quality(3y)112.18%
Profit Quality(5y)98.37%
High Growth Momentum
Growth
EPS 1Y (TTM)1.13%
EPS 3Y16.72%
EPS 5Y-2.01%
EPS Q2Q%-1.89%
EPS Next Y-4.59%
EPS Next 2Y6.99%
EPS Next 3Y11.18%
EPS Next 5Y14.36%
Revenue 1Y (TTM)-3.15%
Revenue growth 3Y6.56%
Revenue growth 5Y3.3%
Sales Q2Q%-7.24%
Revenue Next Year-3.46%
Revenue Next 2Y0.02%
Revenue Next 3Y0.88%
Revenue Next 5Y2.41%
EBIT growth 1Y-5.52%
EBIT growth 3Y6.16%
EBIT growth 5Y-4.12%
EBIT Next Year49.13%
EBIT Next 3Y20.35%
EBIT Next 5YN/A
FCF growth 1Y228.68%
FCF growth 3Y87.62%
FCF growth 5Y-3.77%
OCF growth 1Y34.23%
OCF growth 3Y18.68%
OCF growth 5Y-2.7%