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Market Cap

US$10.9b

Last Updated

2021/04/15 23:04 UTC

Data Sources

Company Financials +

Executive Summary

Lear Corporation designs, develops, engineers, manufactures, assembles, and supplies automotive seating, and electrical distribution systems and related components for automotive original equipment manufacturers in North America, Europe, Africa, Asia, and South America. More Details


Snowflake Analysis

Excellent balance sheet with moderate growth potential.


Similar Companies

Share Price & News

How has Lear's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: LEA is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: LEA's weekly volatility (5%) has been stable over the past year.


Market Performance


7 Day Return

1.5%

LEA

-0.9%

US Auto Components

1.1%

US Market


1 Year Return

119.8%

LEA

121.4%

US Auto Components

56.6%

US Market

Return vs Industry: LEA underperformed the US Auto Components industry which returned 121.4% over the past year.

Return vs Market: LEA exceeded the US Market which returned 56.6% over the past year.


Shareholder returns

LEAIndustryMarket
7 Day1.5%-0.9%1.1%
30 Day-3.8%-11.7%1.7%
90 Day13.7%-3.4%6.0%
1 Year120.5%119.8%122.6%121.4%59.3%56.6%
3 Year-1.2%-5.8%22.2%13.8%62.6%52.2%
5 Year72.4%60.6%71.6%48.5%120.6%96.1%

Long-Term Price Volatility Vs. Market

How volatile is Lear's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Lear undervalued compared to its fair value and its price relative to the market?

11.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: LEA ($179.88) is trading below our estimate of fair value ($204.72)

Significantly Below Fair Value: LEA is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: LEA is poor value based on its PE Ratio (68.4x) compared to the US Auto Components industry average (25.3x).

PE vs Market: LEA is poor value based on its PE Ratio (68.4x) compared to the US market (22.3x).


Price to Earnings Growth Ratio

PEG Ratio: LEA is poor value based on its PEG Ratio (1.6x)


Price to Book Ratio

PB vs Industry: LEA's PB Ratio (2.4x) is in line with the US Auto Components industry average.


Future Growth

How is Lear forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

41.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LEA's forecast earnings growth (41.9% per year) is above the savings rate (2%).

Earnings vs Market: LEA's earnings (41.9% per year) are forecast to grow faster than the US market (18.4% per year).

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

Revenue vs Market: LEA's revenue (8.3% per year) is forecast to grow slower than the US market (9.9% per year).

High Growth Revenue: LEA's revenue (8.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LEA's Return on Equity is forecast to be low in 3 years time (17.5%).


Past Performance

How has Lear performed over the past 5 years?

-14.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LEA has a large one-off loss of $174.6M impacting its December 31 2020 financial results.

Growing Profit Margin: LEA's current net profit margins (0.9%) are lower than last year (4%).


Past Earnings Growth Analysis

Earnings Trend: LEA's earnings have declined by 14.4% per year over the past 5 years.

Accelerating Growth: LEA's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: LEA had negative earnings growth (-79.9%) over the past year, making it difficult to compare to the Auto Components industry average (16.5%).


Return on Equity

High ROE: LEA's Return on Equity (5.1%) is considered low.


Financial Health

How is Lear's financial position?


Financial Position Analysis

Short Term Liabilities: LEA's short term assets ($6.8B) exceed its short term liabilities ($5.1B).

Long Term Liabilities: LEA's short term assets ($6.8B) exceed its long term liabilities ($3.5B).


Debt to Equity History and Analysis

Debt Level: LEA's debt to equity ratio (50.1%) is considered high.

Reducing Debt: LEA's debt to equity ratio has reduced from 64.7% to 50.1% over the past 5 years.

Debt Coverage: LEA's debt is well covered by operating cash flow (28.7%).

Interest Coverage: LEA's interest payments on its debt are well covered by EBIT (6x coverage).


Balance Sheet


Dividend

What is Lear current dividend yield, its reliability and sustainability?

0.55%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: LEA's dividend (0.56%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.24%).

High Dividend: LEA's dividend (0.56%) is low compared to the top 25% of dividend payers in the US market (3.49%).


Stability and Growth of Payments

Stable Dividend: LEA is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: LEA is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: LEA is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of LEA's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

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

2.9yrs

Average management tenure


CEO

Ray Scott (55 yo)

3.08yrs

Tenure

US$13,718,257

Compensation

Mr. Raymond E. Scott Jr., also known as Ray, serves as President, Chief Executive Officer and Director at Lear Corporation since May 1, 2018 and had been its Interim President of E-Systems since January 28...


CEO Compensation Analysis

Compensation vs Market: Ray's total compensation ($USD13.72M) is about average for companies of similar size in the US market ($USD10.98M).

Compensation vs Earnings: Ray's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

Experienced Management: LEA's management team is considered experienced (2.9 years average tenure).


Board Members

Experienced Board: LEA's board of directors are considered experienced (3.1 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: LEA insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Lear Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Lear Corporation
  • Ticker: LEA
  • Exchange: NYSE
  • Founded: 1917
  • Industry: Auto Parts and Equipment
  • Sector: Automobiles
  • Market Cap: US$10.944b
  • Shares outstanding: 60.13m
  • Website: https://www.lear.com

Number of Employees


Location

  • Lear Corporation
  • 21557 Telegraph Road
  • Southfield
  • Michigan
  • 48033
  • United States

Listings


Biography

Lear Corporation designs, develops, engineers, manufactures, assembles, and supplies automotive seating, and electrical distribution systems and related components for automotive original equipment manufac...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/04/15 23:04
End of Day Share Price2021/04/15 00:00
Earnings2020/12/31
Annual Earnings2020/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.