LEAR CORP (LEA)
US5218652049 - Common Stock
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 seems to be doing ok healthwise, there are quite some concerns on its profitability. LEA has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
LEA had positive earnings in the past year.
LEA had a positive operating cash flow in the past year.
LEA had positive earnings in each of the past 5 years.
Each year in the past 5 years LEA had a positive operating cash flow.
1.2 Ratios
The Return On Assets of LEA (3.62%) is worse than 64.20% of its industry peers.
Looking at the Return On Equity, with a value of 11.01%, LEA is doing worse than 60.49% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 9.06%, LEA is doing worse than 60.49% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for LEA is in line with the industry average of 9.44%.
The 3 year average ROIC (7.93%) for LEA is below the current ROIC(9.06%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.62% | ||
| ROE | 11.01% | ||
| ROIC | 9.06% |
ROA(3y)3.03%
ROA(5y)3.25%
ROE(3y)8.9%
ROE(5y)9.52%
ROIC(3y)7.93%
ROIC(5y)8.23%
1.3 Margins
LEA has a worse Profit Margin (2.28%) than 71.60% of its industry peers.
In the last couple of years the Profit Margin of LEA has declined.
LEA has a Operating Margin of 4.57%. This is in the lower half of the industry: LEA underperforms 72.84% of its industry peers.
LEA's Operating Margin has declined in the last couple of years.
With a Gross Margin value of 7.84%, LEA is not doing good in the industry: 91.36% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of LEA has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.57% | ||
| PM (TTM) | 2.28% | ||
| GM | 7.84% |
OM growth 3Y9.2%
OM growth 5Y-10.67%
PM growth 3Y37.78%
PM growth 5Y-14.81%
GM growth 3Y2.91%
GM growth 5Y-6.92%
2. Health
2.1 Basic Checks
LEA has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, LEA has less shares outstanding
Compared to 5 years ago, LEA has less shares outstanding
The debt/assets ratio for LEA has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.93 indicates that LEA is not a great score, but indicates only limited risk for bankruptcy at the moment.
LEA's Altman-Z score of 2.93 is fine compared to the rest of the industry. LEA outperforms 65.43% of its industry peers.
LEA has a debt to FCF ratio of 4.45. This is a neutral value as LEA would need 4.45 years to pay back of all of its debts.
LEA's Debt to FCF ratio of 4.45 is on the low side compared to the rest of the industry. LEA is outperformed by 65.43% of its industry peers.
A Debt/Equity ratio of 0.57 indicates that LEA is somewhat dependend on debt financing.
LEA has a Debt to Equity ratio of 0.57. This is in the lower half of the industry: LEA underperforms 79.01% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.57 | ||
| Debt/FCF | 4.45 | ||
| Altman-Z | 2.93 |
ROIC/WACC1.06
WACC8.54%
2.3 Liquidity
A Current Ratio of 1.33 indicates that LEA should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.33, LEA is doing worse than 87.65% of the companies in the same industry.
LEA has a Quick Ratio of 1.04. This is a normal value and indicates that LEA is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.04, LEA is doing worse than 80.25% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.04 |
3. Growth
3.1 Past
LEA shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 12.71%, which is quite good.
Measured over the past years, LEA shows a decrease in Earnings Per Share. The EPS has been decreasing by -7.97% on average per year.
The Revenue has grown by 12.33% in the past year. This is quite good.
The Revenue has been growing slightly by 2.10% on average over the past years.
EPS 1Y (TTM)12.71%
EPS 3Y31.35%
EPS 5Y-7.97%
EPS Q2Q%8.11%
Revenue 1Y (TTM)12.33%
Revenue growth 3Y11.24%
Revenue growth 5Y2.1%
Sales Q2Q%0.22%
3.2 Future
Based on estimates for the next years, LEA will show a quite strong growth in Earnings Per Share. The EPS will grow by 16.85% on average per year.
Based on estimates for the next years, LEA will show a small growth in Revenue. The Revenue will grow by 3.29% on average per year.
EPS Next Y19.1%
EPS Next 2Y21.94%
EPS Next 3Y21.21%
EPS Next 5Y16.85%
Revenue Next Year4.38%
Revenue Next 2Y4.32%
Revenue Next 3Y4.34%
Revenue Next 5Y3.29%
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 accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 9.57 indicates a reasonable valuation of LEA.
71.60% of the companies in the same industry are more expensive than LEA, based on the Price/Earnings ratio.
LEA's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 24.41.
The Price/Forward Earnings ratio is 6.80, which indicates a rather cheap valuation of LEA.
LEA's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. LEA is cheaper than 74.07% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 20.59. LEA is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.57 | ||
| Fwd PE | 6.8 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of LEA is on the same level as its industry peers.
LEA's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.09 | ||
| EV/EBITDA | 5.12 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
LEA's earnings are expected to grow with 21.21% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.5
PEG (5Y)N/A
EPS Next 2Y21.94%
EPS Next 3Y21.21%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.64%, LEA has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.67, LEA has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.30, LEA has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.64% |
5.2 History
The dividend of LEA has a limited annual growth rate of 1.81%.
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)1.81%
Div Incr Years0
Div Non Decr Years3
5.3 Sustainability
LEA pays out 33.54% of its income as dividend. This is a sustainable payout ratio.
LEA's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP33.54%
EPS Next 2Y21.94%
EPS Next 3Y21.21%
LEAR CORP
NYSE:LEA (7/26/2024, 7:04:00 PM)
After market: 121.41 0 (0%)121.41
+0.65 (+0.54%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupAutomobiles & Components
GICS IndustryAutomobile Components
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap6.89B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.64% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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EPS beat(8)
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EPS beat(12)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.57 | ||
| Fwd PE | 6.8 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.5
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.62% | ||
| ROE | 11.01% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 4.57% | ||
| PM (TTM) | 2.28% | ||
| GM | 7.84% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.59
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.57 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.04 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)12.71%
EPS 3Y31.35%
EPS 5Y
EPS Q2Q%
EPS Next Y19.1%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)12.33%
Revenue growth 3Y11.24%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y