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Lear Sees Chip Crunch Smack Q3 Results, Reduces 2021 Guidance; Slight FVE Increase to $144

Richard Hilgert Senior Equity Analyst

Analyst Note

| Richard Hilgert |

Narrow-moat-rated Lear reported third-quarter earnings per share before special items of $0.53, missing the $0.61 FactSet consensus estimate by $0.08 and dropping $3.20 from EPS of $3.73 reported a year ago. Results were smacked by sporadic customer production caused by the chip crunch. Revenue declined 13% to $4.3 billion from $4.9 billion last year. Year-over-year organic revenue was down 15.0% due to favorable currency but represented a 9-percentage-point outperformance versus production adjusted to Lear’s customer base.

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Company Profile

Business Description

Lear designs, develops, and manufactures automotive seating and electrical systems and components. Seating components include frames and mechanisms, covers (leather and woven fabric), foam, and headrests. Automotive electrical distribution systems and major electrical and electronic components include wiring harnesses, terminals and connectors, junction boxes, electronic control modules, wireless control devices, interior and exterior LED lighting systems, and audio systems and electronics.

21557 Telegraph Road
Southfield, MI, 48033
T +1 248 447-1500
Sector Consumer Cyclical
Industry Auto Parts
Most Recent Earnings Sep 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type Cyclical
Employees 174,600