Company Reports

We will discontinue analyst coverage of Forvia on or about April 22. We provide analyst research and ratings on over 1,500 companies globally and periodically adjust our coverage according to investor interest and staffing.

No-moat-rated Forvia reported full-year 2023 earnings per share before discontinued operations of EUR 1.15, well below the FactSet consensus of EUR 1.63—but EUR 3.35 better than the year-ago loss of EUR 2.20. The United Auto Workers strike, the continued but lessening microchip constraints, geopolitical turmoil, inflationary cost pressures, and problems with a North America seating program contributed to the shortfall. The French auto parts vendor discloses only revenue in the first and third quarters while financial statements are published for half- and full-year results. We raised our fair value estimate to EUR 49 from EUR 48 due to the time value of money. The 5-star-rated shares of Forvia currently trade at a compelling 74% discount to our new fair value.

Forvia (formerly known as Faurecia) announced the acquisition of Hella on Aug. 14, 2021, and closed the deal on Jan. 30, 2022. The firm now owns a 79.5% stake. The combined group changed its name to Forvia. However, because of Forvia's partial stake, Hella still has a stub that trades on the Frankfurt exchange.

No-moat-rated Forvia reported third-quarter revenue of EUR 6.5 billion, just a hair above the FactSet consensus and down 1% on an as-reported basis. Excluding divestitures and currency effect, organic revenue increased 11%, up 7 percentage points above a 4% increase in global light vehicle production. Even though the microchip shortage remains, effects on customer production lessened as backlog ramped up during the quarter. Faurecia's outperformance versus production was across the board in all operating segments and regions. The French auto parts vendor discloses only revenue in the first and third quarters, while financial statements are published for half- and full-year results.

Forvia (formerly known as Faurecia) announced the acquisition of Hella on Aug. 14, 2021, and closed the deal on Jan. 30, 2022. The firm now owns a 79.5% stake. The combined group changed its name to Forvia. However, because of Forvia's partial stake, Hella still has a stub that trades on the Frankfurt exchange.

No-moat-rated Faurecia reported first-half revenue of EUR 13.62 billion, slightly ahead of the FactSet consensus of EUR 13.48 billion by 1%, up 8% from EUR 11.77 billion on an as-reported basis a year ago. Excluding currency translation, acquisitions, and divestitures, organic revenue increased 19%, up 8 percentage points above an 11% increase in global light vehicle production. Even though the microchip shortage remains, effects on customer production lessened as backlog ramped up in the first half. Faurecia's outperformance versus production was across the board in all operating segments and regions. The French auto parts vendor discloses only revenue in the first and third quarters, while financial statements are published for half- and full-year results.

Faurecia announced the acquisition of Hella on Aug. 14, 2021, and closed the deal on Jan. 30, 2022. The firm now owns a 79.5% stake. The combined group was named Forvia. However, because of Faurecia's partial stake, Hella still has a stub that trades on the Frankfurt exchange. As a result, Faurecia stock continues trade on the Paris exchange under its pre-merger name.

No-moat-rated Faurecia reported first-quarter revenue of EUR 6.6 billion, beating the FactSet consensus of EUR 6.4 billion by 4% and up roughly 25% from EUR 5.3 billion on an as-reported basis a year ago. Excluding currency translation, acquisitions, and divestitures, organic revenue increased 18%, or 15 percentage points above the 3% increase in global light-vehicle production. Even though the microchip shortage remains, effects on customer production lessened as backlog ramped up during the quarter. Faurecia's outperformance versus production was across the board in all operating segments and regions. The French auto-parts vendor discloses only revenue in the first and third quarters while financial statements are published for half- and full-year results. The 5-star-rated shares currently trade at an attractive 53% discount to our EUR 45 fair value estimate.

Faurecia announced the acquisition of Hella on Aug. 14, 2021, and closed the deal on Jan. 30, 2022. The firm now owns a 79.5% stake. The combined group was named Forvia. However, because of Faurecia's partial stake, Hella still has a stub that trades on the Frankfurt exchange. As a result, Faurecia stock continues trade on the Paris exchange under its pre-merger name.

No-moat-rated Faurecia reported a 2022 loss per share of EUR 2.20, well below the FactSet consensus of a EUR 1.27 loss and EUR 2.33 worse than the year-ago earnings per share of EUR 0.13. The chip shortage, Ukraine crisis, higher raw material costs, increased energy costs, problems with a seating program launch in North America, and other inflationary cost pressures contributed to the shortfall. The French auto parts vendor discloses only revenue in the first and third quarters while financial statements are published for half- and full-year results.

Faurecia announced the acquisition of Hella on Aug. 14, 2021, and closed the deal on Jan. 30, 2022. The firm now owns a 79.5% stake. The combination appears to us to be complementary in product, customer, and geographic areas. With product lines that directly address several key areas of the auto industry (advanced driver assist systems and autonomous driving, electric mobility, and cockpit), leading market shares, and a global presence, Faurecia is well positioned for growth. Yet, prior to the Hella deal, relatively lower profitability, limited reinvestment, higher financial leverage, and substantial exposure to high-cost countries—which inhibits capacity optimization—had constrained management's progress toward the financial performance that attracts investors. A relatively debt-laden balance sheet and a high fixed cost structure can be detrimental to a company that operates in the highly competitive, capital-intensive, cyclical auto-parts industry.

No-moat-rated Faurecia reduced 2025 objectives in its capital markets day presentation. Management’s “Power25” plan targets 2025 revenue of EUR 30 billion and operating margin above 7% compared with prior 2025 targets of more than EUR 33 billion in revenue and operating margin greater than 8.5%. The firm said that it now assumes global light vehicle production of 88 million, down from its previous assumption of 94 million. In addition, the new 2025 target also assumes about EUR 2 billion of revenue will be divested as part of management’s plan to reduce debt incurred in the Hella acquisition. The company targets about EUR 1.0 billion in debt reduction by the end of 2023. The stock dropped 9% on the news.

Faurecia announced the acquisition of Hella on Aug. 14, 2021, and closed the deal on Jan. 30, 2022. The firm now owns a 79.5% stake. The combination appears to us to be complementary in product, customer, and geographic areas. With product lines that directly address several key areas of the auto industry (advanced driver assist systems and autonomous driving, electric mobility, and cockpit), leading market shares, and a global presence, Faurecia is well positioned for growth. Yet, prior to the Hella deal, relatively lower profitability, limited reinvestment, higher financial leverage, and substantial exposure to high-cost countries—which inhibits capacity optimization—had constrained management's progress toward the financial performance that attracts investors. A relatively debt-laden balance sheet and a high fixed cost structure can be detrimental to a company that operates in the highly competitive, capital-intensive, cyclical auto-parts industry.

No-moat-rated French auto parts supplier Faurecia reported third-quarter 2022 revenue of EUR 6.6 billion representing a 92% increase on an as reported basis compared with EUR 3.4 billion reported in the prior year. Excluding revenue from the Hella acquisition and favorable currency effect, organic revenue increased 31% as the chip shortage alleviated compared to the prior year period. The year-over-year third-quarter increase was 140 basis points better than the 30% jump in global light vehicle production. However, excluding negative geographic mix (COVID-19 lockdown in China), the firm’s revenue outpaced production by 490 basis points. Faurecia only reports revenue in the first and third quarter.

Faurecia announced the acquisition of Hella on Aug. 14, 2021, and closed the deal on Jan. 30, 2022. The firm now owns a 79.5% stake. The combination appears to us to be complementary in product, customer, and geographic areas. With product lines that directly address several key areas of the auto industry (advanced driver assist systems and autonomous driving, electric mobility, and cockpit), leading market shares, and a global presence, Faurecia is well positioned for growth. Yet, prior to the Hella deal, relatively lower profitability, limited reinvestment, higher financial leverage, and substantial exposure to high-cost countries—which inhibits capacity optimization—had constrained management's progress toward the financial performance that attracts investors. A relatively debt-laden balance sheet and a high fixed cost structure can be detrimental to a company that operates in the highly competitive, capital-intensive, cyclical auto-parts industry.

Faurecia announced the acquisition of Hella on Aug. 14, 2021, and closed the deal on Jan. 30, 2022. The firm now owns a 79.5% stake. The combination appears to us to be complementary in product, customer, and geographic areas. With product lines that directly address several key areas of the auto industry (advanced driver assist systems and autonomous driving, electric mobility, and cockpit), leading market shares, and a global presence, Faurecia is well positioned for growth. Yet, prior to the Hella deal, relatively lower profitability, limited reinvestment, higher financial leverage, and substantial exposure to high-cost countries—which inhibits capacity optimization—had constrained management's progress toward the financial performance that attracts investors. A relatively debt-laden balance sheet and a high fixed cost structure can be detrimental to a company that operates in the highly competitive, capital-intensive, cyclical auto-parts industry.

No-moat auto parts supplier Faurecia reported a loss of EUR 1.98 per share for the first half 2022, missing FactSet consensus by EUR 0.48 and down EUR 3.28 from the EUR 1.31 from continuing operations reported last year. Production shutdowns on the microchip shortage, China coronavirus lockdowns, higher raw material costs, other inflationary pressures, and problems with a seating program in North America contributed to the shortfall. Even so, because of the acquisition of Hella, revenue jumped 49.3% to EUR 11.6 billion from EUR 7.8 billion reported in the prior year. The top line was 14% higher than FactSet consensus. Excluding the Hella acquisition and favorable currency effect, organic revenue increased 9.0%. The French auto parts vendor discloses revenue only in the first and third quarters while financial statements are published for half- and full-year results.

Faurecia announced the acquisition of Hella on Aug. 14, 2021, and closed the deal on Jan. 30, 2022. The firm now owns a 79.5% stake. The combination appears to us to be complementary in product, customer, and geographic areas. With product lines that directly address several key areas of the auto industry (advanced driver assist systems and autonomous driving, electric mobility, and cockpit), leading market shares, and a global presence, Faurecia is well positioned for growth. Yet, prior to the Hella deal, relatively lower profitability, limited reinvestment, higher financial leverage, and substantial exposure to high-cost countries—which inhibits capacity optimization—had constrained management's progress toward the financial performance that attracts investors. A relatively debt-laden balance sheet and a high fixed cost structure can be detrimental to a company that operates in the highly competitive, capital-intensive, cyclical auto-parts industry.

No-moat French auto parts supplier Faurecia reported first-quarter 2022 revenue of EUR 5.3 billion representing a 33% increase on an as-reported basis compared to EUR 4.0 billion reported in the prior year. Excluding two months revenue from the Hella acquisition and favorable currency effect, organic revenue increased 1.1%. Because of sporadic production caused by the Ukraine crisis and China COVID-19 lockdowns, March organic revenue declined 6%. Even so, the year-over-year first quarter increase was 530 basis points better than the 4.2% decline in global light vehicle production. Faurecia only reports revenue in the first and third quarter.

Faurecia announced the acquisition of Hella on Aug. 14, 2021, and closed the deal on Jan. 30, 2022. The firm now owns a 79.5% stake. The combination appears to us to be complementary in product, customer, and geographic areas. With product lines that directly address several key areas of the auto industry (advanced driver assist systems and autonomous driving, electric mobility, and cockpit), leading market shares, and a global presence, Faurecia is well positioned for growth. Yet, prior to the Hella deal, relatively lower profitability, limited reinvestment, higher financial leverage, and substantial exposure to high-cost countries--which inhibits capacity optimization--had constrained management's progress toward the financial performance that attracts investors. A relatively debt-laden balance sheet and a high fixed cost structure can be detrimental to a company that operates in the highly competitive, capital-intensive, cyclical auto-parts industry.