Strattec Security (NasdaqGM:STRT) - Share price, News & Analysis

Q: What is the Fair Price of STRT when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

STRT ($28.81) is trading below our estimate of [[fair value]] ($275.67)

STRT fundamental analysis
Snowflake Score
Valuation	4/6
Future Growth	4/6
Past Performance	4/6
Financial Health	6/6
Dividends	0/6

STRT Stock Overview

Strattec Security Corporation designs, develops, manufactures, and markets automotive access control products under the VAST Automotive Group brand primarily in North America.

Rewards

Trading at 89.5% below our estimate of its fair value

Earnings are forecast to grow 43.16% per year

Earnings grew by 5.3% over the past year

Risk Analysis

Shareholders have been diluted in the past year

Strattec Security Competitors

China Automotive Systems

NasdaqCM:CAAS

US$92.2m

Kandi Technologies Group

NasdaqGS:KNDI

US$178.8m

Sypris Solutions

NasdaqGM:SYPR

US$47.3m

Motorcar Parts of America

NasdaqGS:MPAA

US$271.7m

Price History & Performance

Summary of all time highs, changes and price drops for Strattec Security
Historical stock prices
Current Share Price	US$28.81
52 Week High	US$45.82
52 Week Low	US$28.33
Beta	0.89
1 Month Change	-6.28%
3 Month Change	-10.28%
1 Year Change	-36.28%
3 Year Change	34.00%
5 Year Change	-14.89%
Change since IPO	121.62%

Shareholder Returns

	STRT	US Auto Components	US Market
7D	-1.1%	-1.8%	0.3%
1Y	-36.3%	-31.6%	-13.5%

Return vs Industry: STRT underperformed the US Auto Components industry which returned -29.2% over the past year.

Return vs Market: STRT underperformed the US Market which returned -13% over the past year.

Price Volatility

Is STRT's price volatile compared to industry and market?
STRT volatility
STRT Average Weekly Movement	6.5%
Auto Components Industry Average Movement	8.2%
Market Average Movement	7.9%
10% most volatile stocks in US Market	17.2%
10% least volatile stocks in US Market	3.2%

Stable Share Price: STRT is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: STRT's weekly volatility (7%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1908	3,752	Frank Krejci	https://www.strattec.com

Strattec Security Corporation designs, develops, manufactures, and markets automotive access control products under the VAST Automotive Group brand primarily in North America. The company offers mechanical and electronically enhanced locks and keys, passive entry passive start systems, steering column and instrument panel ignition lock housings, latches, power sliding side door systems, power tailgate and lift gate systems, power deck lid systems, door handles, and related products. It also provides full service and aftermarket support services for its products.

Strattec Security Fundamentals Summary

How do Strattec Security's earnings and revenue compare to its market cap?
STRT fundamental statistics
Market Cap	US$114.12m
Earnings (TTM)	US$9.57m
Revenue (TTM)	US$439.25m

11.9x

P/E Ratio

0.3x

P/S Ratio

Is STRT overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
STRT income statement (TTM)
Revenue	US$439.25m
Cost of Revenue	US$381.88m
Gross Profit	US$57.37m
Other Expenses	US$47.81m
Earnings	US$9.57m

Last Reported Earnings

Mar 27, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	2.42
Gross Margin	13.06%
Net Profit Margin	2.18%
Debt/Equity Ratio	5.4%

How did STRT perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is STRT undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for STRT?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for STRT. This is calculated by dividing STRT's market cap by their current preferred multiple.
What is STRT's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$114.12m

STRT key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.3x
Enterprise Value/EBITDA	4.7x
PEG Ratio	0.3x

Price to Earnings Ratio vs Peers

How does STRT's PE Ratio compare to its peers?

STRT PE Ratio vs Peers

The above table shows the PE ratio for STRT vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	11.7x
CAAS China Automotive Systems	11.8x	19.4%	US$92.2m
KNDI Kandi Technologies Group	n/a	n/a	US$178.8m
SYPR Sypris Solutions	9.9x	n/a	US$47.3m
MPAA Motorcar Parts of America	36.9x	65.5%	US$271.7m
STRT Strattec Security	11.9x	43.2%	US$114.1m

Price-To-Earnings vs Peers: STRT is expensive based on its Price-To-Earnings Ratio (11.9x) compared to the peer average (11.7x).

Price to Earnings Ratio vs Industry

How does STRT's PE Ratio compare vs other companies in the US Auto Components Industry?

Price-To-Earnings vs Industry: STRT is good value based on its Price-To-Earnings Ratio (11.9x) compared to the US Auto Components industry average (17.4x)

Price to Earnings Ratio vs Fair Ratio

What is STRT's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

STRT PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	11.9x
Fair PE Ratio	16.4x

Price-To-Earnings vs Fair Ratio: STRT is good value based on its Price-To-Earnings Ratio (11.9x) compared to the estimated Fair Price-To-Earnings Ratio (16.4x).

Share Price vs Fair Value

What is the Fair Price of STRT when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: STRT ($28.81) is trading below our estimate of fair value ($275.67)

Significantly Below Fair Value: STRT is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.

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Future Growth

How is Strattec Security forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

43.2%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: STRT's forecast earnings growth (43.2% per year) is above the savings rate (1.9%).

Earnings vs Market: STRT's earnings (43.2% per year) are forecast to grow faster than the US market (14.6% per year).

High Growth Earnings: STRT's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: STRT's revenue (8.9% per year) is forecast to grow faster than the US market (7.9% per year).

High Growth Revenue: STRT's revenue (8.9% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: STRT's Return on Equity is forecast to be low in 3 years time (11.8%).

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Past Performance

How has Strattec Security performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

9.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: STRT has high quality earnings.

Growing Profit Margin: STRT's current net profit margins (2.2%) are higher than last year (2.2%).

Past Earnings Growth Analysis

Earnings Trend: STRT's earnings have grown by 9.2% per year over the past 5 years.

Accelerating Growth: STRT's earnings growth over the past year (5.3%) is below its 5-year average (9.2% per year).

Earnings vs Industry: STRT earnings growth over the past year (5.3%) exceeded the Auto Components industry 4.8%.

Return on Equity

High ROE: STRT's Return on Equity (5.7%) is considered low.

Discover strong past performing companies

Financial Health

How is Strattec Security's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: STRT's short term assets ($189.7M) exceed its short term liabilities ($80.0M).

Long Term Liabilities: STRT's short term assets ($189.7M) exceed its long term liabilities ($19.3M).

Debt to Equity History and Analysis

Debt Level: STRT has more cash than its total debt.

Reducing Debt: STRT's debt to equity ratio has reduced from 15.7% to 5.4% over the past 5 years.

Debt Coverage: STRT's debt is well covered by operating cash flow (179.5%).

Interest Coverage: STRT's interest payments on its debt are well covered by EBIT (54.3x coverage).

Balance Sheet

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Dividend

What is Strattec Security current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate STRT's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate STRT's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if STRT's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if STRT's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: STRT is not paying a notable dividend for the US market.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as STRT has not reported any payouts.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

8.8yrs

Average management tenure

CEO

Frank Krejci (72 yo)

11.92yrs

Tenure

US$1,337,135

Compensation

Mr. Frank Joseph Krejci has been the Chief Executive Officer of STRATTEC Security Corporation since September 1, 2012 and has been its President since 2010. Mr. Krejci has been the President of Wisconsin F...

CEO Compensation Analysis

Compensation vs Market: Frank's total compensation ($USD1.34M) is above average for companies of similar size in the US market ($USD763.69K).

Compensation vs Earnings: Frank's compensation has increased by more than 20% in the past year.

Leadership Team

Experienced Management: STRT's management team is seasoned and experienced (8.8 years average tenure).

Board Members

Experienced Board: STRT's board of directors are seasoned and experienced ( 21.9 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 4.1%.

Data	Last Updated (UTC time)
Company Analysis	2022/08/09 00:00
End of Day Share Price	2022/08/09 00:00
Earnings	2022/03/27
Annual Earnings	2021/06/27