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Gentex Corp GNTX

Rating as of

Morningstar’s Analysis

Valuation
Currency in USD
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

We Believe Gentex's Third Quarter Shows the Chance for a Strong 2021

Analyst Note

| David Whiston, CFA, CPA, CFE |

Gentex reported a 9.1% year-over-year increase in third quarter diluted EPS with the $0.48 posted beating Refinitiv’s consensus of $0.41. Revenue fell 0.7% but was the second-highest total ever recorded other than third-quarter 2019, so the good quarter faced a tough comparable. In light of 2020 trending better than modeled as a recovery from the pandemic is happening faster than expected in the spring, Gentex introducing 2021 revenue guidance of 15%-20% growth from 2020, cost reductions from second quarter in our view enabling the chance of gross margins next year of nearly 40%, and the time value of money, we are increasing our fair value estimate to $31 from $25.

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Company Profile

Business Description

Gentex was founded in 1974 to produce smoke-detection equipment. The company sold its first glare-control interior mirror in 1982 and its first model using electrochromic technology in 1987. Automotive revenue is about 97% of total revenue, and the company is constantly developing new applications for the technology to remain on top. Sales from 2019 totaled about $1.9 billion with 42.9 million mirrors shipped. The company is based in Zeeland, Michigan.

Contact
600 North Centennial Street
Zeeland, MI, 49464
T +1 616 772-1800
Sector Consumer Cyclical
Industry Auto Parts
Most Recent Earnings Sep 30, 2020
Fiscal Year End Dec 31, 2020
Stock Type Cyclical
Employees 5,874

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