In a report released today, Michael Jacks from Bank of America Securities reiterated a Buy rating on Autoliv (ALV – Research Report), with a price target of $126.00.
Michael Jacks has provided a Buy rating for Autoliv’s stock due to a blend of positive factors influencing the company’s future prospects. Jacks highlights Autoliv’s market leadership in passive safety with a significant market share of approximately 43%, which positions the company well within the automotive supply chain. Moreover, he identifies a potential for margin expansion, the company’s agnostic approach to drivetrains, high-quality earnings, and a disciplined approach to capital allocation as key drivers behind the optimistic outlook. This is further supported by expectations of market share gains, particularly in the wake of recent automotive recalls that may bolster Autoliv’s position.
Additionally, Jacks anticipates that Autoliv’s financial performance will strengthen, with margin targets being aggressively approached in the coming year and an exit rate of 12% by the fourth quarter. Despite a conservative projection for global vehicle production levels, he expects the company to outperform the market. Cost-savings measures, a committed share buyback program, and a favorable valuation at 10.9 times forward earnings per share underpin the recommendation to Buy. Jacks slightly adjusts the price objective to $126 per share from $127, which still suggests a considerable upside from the current trading price, reinforcing the Buy rating.
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Autoliv (ALV) Company Description:
Autoliv, Inc. engages in the development, manufacture, and supply of automotive safety systems. It operates through the Passive Safety and Electronics segment. The Passive Safety segment includes airbags, seatbelts, steering wheels, and restrain electronics. The Electronics segment comprises of restraint control systems, brake control systems and active safety. The company was founded by Lennart Lindblad in 1953 and is headquartered in Stockholm, Sweden.
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