Analyst Note| Richard Hilgert |
On Oct. 11, narrow-moat-rated Aptiv reduced 2021 guidance. Due to the microchip shortage and lingering effects of COVID-19, the company sees second-half 2021 global light-vehicle production at 38 million units, down 14% from its prior guidance that had assumed 44 million units. The time value of money since our last update would have added $1 to our fair value estimate, which was offset by changes to our model. However, the 2-star-rated shares of Aptiv currently trade at a 53% premium to our unchanged $105 fair value estimate.