Company Reports

We will discontinue analyst coverage of Lear 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.

Narrow-moat Lear reported fourth-quarter earnings per share before special items of $3.03, $0.09 shy of the $3.12 FactSet consensus but increasing $0.22 from $2.81 EPS reported a year ago, despite the UAW strike. Results were also negatively affected by supply chain disruptions, inflationary cost pressures, and higher launch costs. Revenue increased 9% to $5.8 billion from $5.3 billion last year, 3% above consensus. Organic revenue rose 5%, 2 percentage points less than a 7% increase in light vehicle production adjusted to Lear's customers, mainly due to the GM truck plant labor stoppage. Revenue growth was supported by new business and inflationary cost recoveries.

In our opinion, Lear's revenue will grow in excess of increases in annual worldwide light-vehicle production. The company is well positioned to capitalize on several trends in the global automotive industry, including automakers' focus on high-quality interiors, premium-vehicle segment growth, the proliferation of automotive electronics, and battery electric vehicles. Lear competes in the markets for vehicle seating and automotive electrical and electronic architecture. A culture of continuous innovation, high customer switching costs, highly integrated engineering relationships with customers, and lengthy vehicle programs provide Lear with sticky market share.

Narrow-moat-rated Lear reported third-quarter earnings per share before special items of $2.87, beating the $2.61 FactSet consensus by $0.26 and rising $0.54 from $2.33 EPS reported a year ago, despite the UAW strike. Results were also still affected by customer slowdowns from the chip shortage and other supply-chain disruptions. Revenue increased 10% to $5.8 billion from $5.2 billion last year, 3% above consensus. Organic revenue rose 7%, 1 percentage point less than an 8% increase in light vehicle production adjusted to Lear’s customers, mainly due to the GM truck plant labor stoppage. Revenue growth was supported by new business and cost recoveries.

In our opinion, Lear's revenue will grow in excess of increases in annual worldwide light-vehicle production. The company is well positioned to capitalize on several trends in the global automotive industry, including automakers' focus on high-quality interiors, premium-vehicle segment growth, the proliferation of automotive electronics, and battery electric vehicles. Lear competes in the markets for vehicle seating and automotive electrical and electronic architecture. A culture of continuous innovation, high customer switching costs, highly integrated engineering relationships with customers, and lengthy vehicle programs provide Lear with sticky market share.

Narrow-moat-rated Lear reported second-quarter earnings per share before special items of $3.33, beating the $3.21 FactSet consensus by $0.12 and jumping $1.54 from $1.79 EPS reported a year ago as the chip crunch alleviates. Results were still affected by customer slowdowns from the chip shortage and other supply chain disruptions. Revenue increased 18% to $6.0 billion from $5.1 billion last year, 2% above consensus. Organic revenue rose 17%, 2 percentage points above a 15% increase in light-vehicle production adjusted to Lear’s customers. Revenue growth was supported by new business, product mix, customer volume, and cost recoveries.

In our opinion, Lear's revenue will grow in excess of increases in annual worldwide light-vehicle production. The company is well positioned to capitalize on several trends in the global automotive industry, including automakers' focus on high-quality interiors, premium-vehicle segment growth, the proliferation of automotive electronics, and battery electric vehicles. Lear competes in the markets for vehicle seating and automotive electrical and electronic architecture. A culture of continuous innovation, high customer switching costs, highly integrated engineering relationships with customers, and lengthy vehicle programs provide Lear with sticky market share.

Narrow-moat-rated Lear put seating technologies on display at its investor day, highlighting FlexAir, seat component modularity, and INTU seating. Lear's moat results from intellectual property intangible assets and switching costs. Automakers pay vendors for technologies, like Lear’s, that differentiate vehicles, reduce weight, or lower cost. While one innovation does not make a moat, Lear’s pipeline of new technologies creates a stream of intellectual property that flows into an economic moat. Due to changes in our model, we have raised our fair value estimate to $162 from $150. The 3-star-rated shares of Lear currently trade at a 13% discount to our new fair value estimate.

In our opinion, Lear's revenue will grow in excess of increases in annual worldwide light-vehicle production. The company is well positioned to capitalize on several trends in the global automotive industry, including automakers' focus on high-quality interiors, premium-vehicle segment growth, the proliferation of automotive electronics, and battery electric vehicles. Lear competes in the markets for vehicle seating and automotive electrical and electronic architecture. A culture of continuous innovation, high customer switching costs, highly integrated engineering relationships with customers, and lengthy vehicle programs provide Lear with sticky market share.

Narrow-moat-rated Lear reported first-quarter earnings per share before special items of $2.78, beating the $2.57 FactSet consensus estimate by $0.21 and climbing $0.98 from the $1.80 reported a year ago, when the chip crunch was much worse. Results continue to be affected by customer production shutdowns and, to a lesser degree, the chip crunch. Revenue increased 12% to $5.8 billion from $5.2 billion last year, beating consensus by 4%. Organic revenue rose 14%, 6 percentage points above the 8% increase in global light-vehicle production adjusted to Lear’s customer base. Revenue growth was supported by new-business backlog, product mix, higher customer production, and cost recoveries.

In our opinion, Lear's revenue will grow in excess of increases in annual worldwide light-vehicle production. The company is well positioned to capitalize on several trends in the global automotive industry, including automakers' focus on high-quality interiors, premium-vehicle segment growth, the proliferation of automotive electronics, and battery electric vehicles. Lear competes in the markets for vehicle seating and automotive electrical and electronic architecture. A culture of continuous innovation, high customer switching costs, highly integrated engineering relationships with customers, and lengthy vehicle programs provide Lear with sticky market share.

In our opinion, Lear's revenue will grow in excess of increases in annual worldwide light-vehicle production. The company is well-positioned to capitalize on several trends in the global automotive industry, including automakers' focus on high-quality interiors, premium-vehicle segment growth, the proliferation of automotive electronics, and battery electric vehicles. Lear competes in the markets for vehicle seating and automotive electrical and electronic architecture. A culture of continuous innovation, high customer switching costs, highly integrated engineering relationships with customers, and lengthy vehicle programs provide Lear with sticky market share.

Narrow-moat-rated Lear reported fourth-quarter earnings per share before special items of $2.81, beating the $2.57 FactSet consensus estimate by $0.24 and climbing $1.59 from $1.22 EPS reported a year ago when the chip crunch was much worse. Results continue to be impacted by customer production shutdowns but to a lesser degree from China's COVID-19 resurgence, the chip crunch, and the Ukraine crisis, which caused supply chain disruption. Revenue increased 10% to $5.4 billion from $4.9 billion last year, better than consensus by 2%. Excluding currency and acquisitions, organic revenue rose 13%, 7% above the 6% increase in global light vehicle production adjusted to Lear’s customer base. Revenue growth was supported by new business backlog, higher customer production, and customer cost recoveries.

In our opinion, Lear's revenue will grow in excess of increases in annual worldwide light-vehicle production. The company is well-positioned to capitalize on several trends in the global automotive industry, including automakers' focus on high-quality interiors, premium-vehicle segment growth, the proliferation of automotive electronics, and battery electric vehicles. Lear competes in the markets for vehicle seating and automotive electrical and electronic architecture. A culture of continuous innovation, high switching costs for customers, highly integrated engineering relationships with customers, and lengthy vehicle programs provide Lear with sticky market share.

Narrow-moat-rated Lear reported third-quarter earnings per share before special items of $2.33, beating the $2.12 FactSet consensus estimate by $0.21 and climbing $1.80 from $0.53 EPS reported a year ago when the chip crunch was at its worst. Results continue to be impacted by sporadic customer production, but to a lesser degree, from China's COVID-19 lockdowns, the chip crunch, the Ukraine crisis, supply chain disruption, higher raw material cost, and increased logistic expense. Revenue increased 23% to $5.2 billion from $4.3 billion last year, better than consensus by 2%. Excluding currency and acquisitions, organic revenue rose 26%, 1% point above the 25% increase in global light vehicle production adjusted to Lear’s customer base. Revenue growth was supported by new business backlog, higher customer production, and customer cost recoveries.

In our opinion, Lear's revenue will grow in excess of increases in annual worldwide light-vehicle production. The company is well-positioned to capitalize on several trends in the global automotive industry, including automakers' focus on high-quality interiors, premium-vehicle segment growth, the proliferation of automotive electronics, and battery electric vehicles. Lear competes in the markets for vehicle seating and automotive electrical and electronic architecture. A culture of continuous innovation, high switching costs for customers, highly integrated engineering relationships with customers, and lengthy vehicle programs provide Lear with sticky market share.

In our opinion, Lear's revenue will grow in excess of increases in annual worldwide light-vehicle production. The company is well-positioned to capitalize on several trends in the global automotive industry, including automakers' focus on high-quality interiors, premium-vehicle segment growth, the proliferation of automotive electronics, and battery electric vehicles. Lear competes in the markets for vehicle seating and automotive electrical and electronic architecture. A culture of continuous innovation, high switching costs for customers, highly integrated engineering relationships with customers, and lengthy vehicle programs provide Lear with sticky market share.

Narrow-moat rated Lear reported second quarter earnings per share before special items of $1.79, beating the $1.45 FactSet consensus estimate by $0.34 but dropping $0.66 from $2.45 EPS reported a year ago. Results were hit by sporadic customer production from China COVID-19 lockdowns, the chip crunch, the Ukraine crisis, supply chain disruption, higher raw material cost, and increased logistic expense. Revenue increased 7% to $5.1 billion from $4.8 billion last year, better than consensus by 1%. Excluding currency and acquisitions, organic revenue rose 11%, 10 percentage points above the 1% increase in global light vehicle production adjusted to Lear’s customer base.

In our opinion, Lear's revenue will grow in excess of increases in annual worldwide light-vehicle production. The company is well-positioned to capitalize on several trends in the global automotive industry, including automakers' focus on high-quality interiors, premium-vehicle segment growth, the proliferation of automotive electronics, and battery electric vehicles. Lear competes in the markets for vehicle seating and automotive electrical and electronic architecture. A culture of continuous innovation, high switching costs for customers, highly integrated engineering relationships with customers, and lengthy vehicle programs provide Lear with sticky market share.

Narrow-moat-rated Lear reported first quarter earnings per share before special items of $1.80, beating the $1.59 FactSet consensus estimate by $0.21 but dropping $1.93 from $3.73 EPS reported a year ago. Results were hit by sporadic customer production from the chip crunch, China's COVID-19 lockdowns, the Ukraine crisis, supply chain disruption, higher raw material cost, and increased logistic expense. Revenue declined 3% to $5.2 billion from $5.4 billion last year, better than consensus by 4%. The 3% decline represented a 4-percentage point outperformance over the 7% decline in global light vehicle production adjusted to Lear’s customer base.