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Veoneer Inc Ordinary Shares VNE

Rating as of

Morningstar’s Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Veoneer Q3 Revenue Growth Despite Chip Crunch; Maintaining Our $37 Fair Value Estimate

Richard Hilgert Senior Equity Analyst

Analyst Note

| Richard Hilgert |

Narrow-moat rated Veoneer, supplier of advanced driver assistance systems, reported third-quarter losses per share of $0.84, just $0.03 shy of the FactSet sell-side consensus of an $0.81 loss per share. Even though COVID-19 recovery improved year-ago results and the microchip shortage made customer production sporadic this year, the company posted a $0.34 per share reduction in losses compared with a $1.18 per share loss last year. The company has withdrawn guidance and did not host a conference call with analysts due to the ongoing process whereby SSW and Qualcomm will acquire the company. For additional details about the acquisition, please see our Veoneer notes dated July 23, Aug. 5, and Oct. 4. Because Veoneer agreed to be acquired for $37 per share, we raised our fair value estimate to the offer price. On a standalone basis, our fair value would be $27.

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Company Profile

Business Description

Veoneer designs, develops, and makes safety electronics for the global automotive industry. Passive safety products include sensors, electronic control units, and software used to prepare seat belt pretensioners, and to deploy airbags in a collision. Active safety products include sensors, electronic control units, and software that enable advanced driver assistance systems, or ADAS, highly automated driving, or HAD, and autonomous driving, or AD. Roughly one-third of revenue comes from each of Europe, the Americas, and Asia. Daimler, Hyundai/Kia, Ford, Honda, and General Motors are the company’s five largest customers, accounting for 61% of 2020 revenue.

Contact
Klarabergsviadukten 70, Box 13089, Section C6
Stockholm, SE-103 02, Sweden
T +46 852776200
Sector Consumer Cyclical
Industry Auto Parts
Most Recent Earnings Sep 30, 2021
Fiscal Year End Dec 31, 2020
Stock Type Distressed
Employees 7,543