LEAR CORP (LEA) Stock Fundamental Analysis
NYSE:LEA - New York Stock Exchange, Inc. - US5218652049 - Common Stock - Currency: USD
Overall LEA gets a fundamental rating of 4 out of 10. We evaluated LEA against 80 industry peers in the Automobile Components industry. There are concerns on the financial health of LEA while its profitability can be described as average. 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
LEA had positive earnings in the past year.
In the past year LEA had a positive cash flow from operations.
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
LEA has a worse Return On Assets (3.27%) than 66.25% of its industry peers.
LEA's Return On Equity of 10.25% is amongst the best of the industry. LEA outperforms 87.50% of its industry peers.
With an excellent Return On Invested Capital value of 8.77%, LEA belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for LEA is in line with the industry average of 9.12%.
The last Return On Invested Capital (8.77%) for LEA is above the 3 year average (8.42%), which is a sign of increasing profitability.
| 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
LEA has a worse Profit Margin (2.09%) than 67.50% of its industry peers.
In the last couple of years the Profit Margin of LEA has declined.
LEA has a worse Operating Margin (4.48%) than 71.25% of its industry peers.
LEA's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 7.71%, LEA is doing worse than 91.25% of the companies in the same industry.
In the last couple of years the Gross Margin of LEA has declined.
| 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 below the Cost of Capital (WACC), so LEA is destroying value.
Compared to 1 year ago, LEA has less shares outstanding
The number of shares outstanding for LEA has been reduced compared to 5 years ago.
LEA has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.86 indicates that LEA is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.86, LEA is in the better half of the industry, outperforming 65.00% of the companies in the same industry.
The Debt to FCF ratio of LEA is 5.78, which is a neutral value as it means it would take LEA, 5.78 years of fcf income to pay off all of its debts.
LEA has a worse Debt to FCF ratio (5.78) than 67.50% 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's Debt to Equity ratio of 0.59 is on the low side compared to the rest of the industry. LEA is outperformed by 72.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 5.78 | ||
| Altman-Z | 2.86 |
ROIC/WACC0.99
WACC8.89%
2.3 Liquidity
A Current Ratio of 1.32 indicates that LEA should not have too much problems paying its short term obligations.
With a Current ratio value of 1.32, LEA is not doing good in the industry: 87.50% of the companies in the same industry are doing better.
LEA has a Quick Ratio of 1.03. This is a normal value and indicates that LEA is financially healthy and should not expect problems in meeting its short term obligations.
With a Quick ratio value of 1.03, LEA is not doing good in the industry: 82.50% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.32 | ||
| Quick Ratio | 1.03 |
3. Growth
3.1 Past
LEA shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.13%.
The Earnings Per Share has been decreasing by -2.01% on average over the past years.
LEA shows a decrease in Revenue. In the last year, the revenue decreased by -3.15%.
LEA shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.30% yearly.
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
Based on estimates for the next years, LEA will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.36% on average per year.
Based on estimates for the next years, LEA will show a small growth in Revenue. The Revenue will grow by 2.41% on average per year.
EPS Next Y-6.01%
EPS Next 2Y5.04%
EPS Next 3Y10.62%
EPS Next 5Y14.36%
Revenue Next Year-3.76%
Revenue Next 2Y-0.29%
Revenue Next 3Y0.97%
Revenue Next 5Y2.41%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 8.49, the valuation of LEA can be described as very reasonable.
Based on the Price/Earnings ratio, LEA is valued a bit cheaper than the industry average as 77.50% of the companies are valued more expensively.
LEA is valuated cheaply when we compare the Price/Earnings ratio to 27.41, which is the current average of the S&P500 Index.
LEA is valuated cheaply with a Price/Forward Earnings ratio of 7.66.
Based on the Price/Forward Earnings ratio, LEA is valued a bit cheaper than 72.50% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 35.19, LEA is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.49 | ||
| Fwd PE | 7.66 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of LEA indicates a somewhat cheap valuation: LEA is cheaper than 70.00% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of LEA is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.92 | ||
| EV/EBITDA | 4.67 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y5.04%
EPS Next 3Y10.62%
5. Dividend
5.1 Amount
LEA has a Yearly Dividend Yield of 2.86%.
Compared to an average industry Dividend Yield of 4.19, LEA has a dividend in line with its industry peers.
LEA's Dividend Yield is a higher than the S&P500 average which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.86% |
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 Years4
5.3 Sustainability
35.90% of the earnings are spent on dividend by LEA. This is a low number and sustainable payout ratio.
LEA's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP35.9%
EPS Next 2Y5.04%
EPS Next 3Y10.62%
106.57
-1.1 (-1.02%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupAutomobiles & Components
GICS IndustryAutomobile Components
Earnings (Last)
Earnings (Next)
Inst Owners108.49%
Inst Owner Change0%
Ins Owners0.62%
Ins Owner Change18.41%
Market Cap5.70B
Analysts73.33
Price Target104.13 (-2.29%)
Short Float %2.74%
Short Ratio2.18
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.86% |
Yearly Dividend3.14
Dividend Growth(5Y)0.74%
DP35.9%
Div Incr Years0
Div Non Decr Years4
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)0.41%
PT rev (3m)-14.44%
EPS NQ rev (1m)1.45%
EPS NQ rev (3m)3.76%
EPS NY rev (1m)-1.67%
EPS NY rev (3m)-7.11%
Revenue NQ rev (1m)0.55%
Revenue NQ rev (3m)1.29%
Revenue NY rev (1m)0.42%
Revenue NY rev (3m)-0.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.49 | ||
| Fwd PE | 7.66 | ||
| P/S | 0.25 | ||
| P/FCF | 11.92 | ||
| P/OCF | 5.55 | ||
| P/B | 1.22 | ||
| P/tB | 1.94 | ||
| EV/EBITDA | 4.67 |
EPS(TTM)12.55
EY11.78%
EPS(NY)13.91
Fwd EY13.05%
FCF(TTM)8.94
FCFY8.39%
OCF(TTM)19.21
OCFY18.03%
SpS427.83
BVpS87.14
TBVpS54.9
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 | 2.86 |
F-Score4
WACC8.89%
ROIC/WACC0.99
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-6.01%
EPS Next 2Y5.04%
EPS Next 3Y10.62%
EPS Next 5Y14.36%
Revenue 1Y (TTM)-3.15%
Revenue growth 3Y6.56%
Revenue growth 5Y3.3%
Sales Q2Q%-7.24%
Revenue Next Year-3.76%
Revenue Next 2Y-0.29%
Revenue Next 3Y0.97%
Revenue Next 5Y2.41%
EBIT growth 1Y-5.52%
EBIT growth 3Y6.16%
EBIT growth 5Y-4.12%
EBIT Next Year42.53%
EBIT Next 3Y19.16%
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%