Credit Suisse just raised its price target on this automotive supplier, from $121.00 to $127.00 per share, and confirmed its “outperform” rating, noting the company’s earnings beat, as well as its margin outperformance.
Magna International (MGA)
from 2 for 1 Stock Split Newsletter
Magna International (MGA) is a $22B Canadian company, based near Toronto, making a wide variety of automotive parts and systems. Magna runs a global network of 312 manufacturing operations and 83 product development, engineering and sales centers, supporting every major auto manufacturer in the world.
This very wide diversification of facilities and product lines smooths out both the top and bottom lines of the quarterly financial statements and the vagaries of the auto market. MGA is below its peers in PE and price-to-book ratios (a good thing) and above its peers in average revenue and cash flow growth rates over the last five years.
Return on investment for MGA is running around 20%—all this with a strong balance sheet and solid profit margin. We’ll have to put up with a Beta, or measure of volatility, of 1.24, one of the few below-par metrics of all the screens in our scoring algorithm.
Neil Macneale, 2 for 1 Stock Split Newsletter, www.2-for-1.com, 408-210-6881, March 13, 2015