DLPH

Delphi Technologies PLC

Industrial/Transportation


Presented:04/10/2019
Price:$23.96
Cap:$2.12B
Current Price:$17.02
Cap:$1.46B

Presented

Date04/10/2019
Price$23.96
Market Cap$2.12B
Ent Value$2.59B
P/E Ratio5.94x
Book Value$3.30
Div Yield2.84%
Shares O/S88.49M
Ave Daily Vol1,347,240
Short Int6.37%

Current

Price$17.02
Market Cap$1.46B
Delphi Technologies PLC engages in the development, design, and manufacture of integrated powertrain technologies. It operates through the following segments: Powertrain Systems, Aftermarket and Eliminations and Others. The Powertrain Systems segment manufactures fuel injection systems as well as various other powertrain products including valvetrain, fuel delivery modules, ignition coils, canisters, sensors, valves, and actuators. The Aftermarket segment sells aftermarket products to independent aftermarket and original equipment service customers. This segment also supplies a wide range of aftermarket products and services covering the fuel injection, electronics and engine management, maintenance, and test equipment and vehicle diagnostics categories. The Eliminations and Other segment include the elimination of inter-segment transactions. The company is headquartered in London, the United Kingdom.

Publicly traded companies mentioned herein: Aptiv PLC (APTV), Delphi Technologies PLC (DLPH)

Highlights

In December 2017, Delphi Automotive (now Aptiv) completed the spin-off of its Powertrain segment, Delphi Technologies (DLPH). Since then, the Tier-1 powertrain supplier has had a “rough go” at “it” (being a standalone). In 2018, the stock fell ~75% due to industry headwinds and its exposure to China. More specifically, DLPH has outsized exposure to the local OEMs, which performed even more poorly than the overall Chinese market. To make matters worse, Delphi had some missteps around the transition to gasoline direct-injection (GDi), and CEO Liam Butterworth announced that he was stepping down in October when guidance (for revenue and margins) was slashed. With expectations now reset, transition services agreements (TSAs) rolling off, and new CEO Rick Dauch focused on the turnaround of the company, the presenter sees a favorable risk/reward and is long the stock. He targets $36 per share in 12 - 24 months if EPS can improve to $4.50 in 2021 and the stock trades at 8x.

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