ADNT

Adient plc

Industrial/Transportation


Presented:07/08/2020
Price:$16.90
Cap:$1.59B
Current Price:$21.35
Cap:$1.86B

Presented

Date07/08/2020
Price$16.90
Market Cap$1.59B
Ent Value$4.48B
P/E RatioN/A
Book Value$16.42
Div Yield0%
Shares O/S93.88M
Ave Daily Vol1,395,799
Short Int4.11%

Current

Price$21.35
Market Cap$1.86B
Adient plc manufactures automotive seating systems. The firm's products include Complete Seats, Commercial vehicle seats, Structures & Mechanisms, Foam, Fabrics and Trim. It operates through the following segments: Seating, Seat Structures and Mechanism, and Interiors segments. The Seating segment produces automotive seat metal structures and mechanisms, foam, trim, and fabric. The Seat Structures and Mechanism segment produces seat structures and mechanisms for inclusion in complete seat systems that are produced by Adient or others. The Interiors segment offers instrument panels, floor consoles, door panels, overhead consoles, cockpit systems, and decorative trim. The company was founded on December 17, 2015 and is headquartered Dublin, Ireland.

Publicly traded companies mentioned herein: Adient PLC (ADNT), Boeing Co/The (BA), Faurecia SE (EO FP), Johnson Controls International plc (JCI), Lear Corp (LEA), Magna International Inc (MGA), Peugeot SA (UG FP)

Highlights

The presenter is long shares of Adient PLC (ADNT), a Tier-1 auto supplier spun off from JCI in October 2016 that makes car seats for one out of every three automobiles produced globally. Since trading as high as ~$84 per share in September 2017, ADNT has declined to the current ~$17 per share due to operational issues and a cyclical downturn. At the current price and time, the presenter believes ADNT is at an inflection point in its turnaround story and the stock offers a compelling value opportunity. If he is correct, investors can buy a well-positioned, dominant player with ~33% share globally at a very attractive valuation. Additionally, ADNT’s market share in China (40% – 45%) is higher than its global average, driving more than half of total EBITDA in FY2019 (FY2019 ended September 30, 2019). Based on his optimism regarding the turnaround, there is a large delta between his and the Street’s multiyear outlooks and he sees the potential for ADNT’s equity value to more than double.

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