ALV

Autoliv Inc

Industrial/Transportation


Presented:12/21/2016
Price:$112.89
Cap:$9.99B
Current Price:$93.67
Cap:$7.50B

Presented

Date12/21/2016
Price$112.89
Market Cap$9.99B
Ent Value$10.09B
P/E Ratio16.2x
Book Value$42.66
Div Yield0.02%
Shares O/S88.50M
Ave Daily Vol451,514
Short Int6.05%

Current

Price$93.67
Market Cap$7.50B
Autoliv, Inc. develops and manufactures automotive safety systems for automobile manufacturers. It operates through the Passive Safety Products and Active Safety Products segments. The Passive Safety Products segment products include airbags, seatbelts, steering wheels, and restrain electronics. The Active Safety Products comprises of camera vision, night vision, and radar systems. The company was founded in 1997 and is headquartered in Stockholm, Sweden.

Publicly traded companies mentioned herein: Autoliv Inc (ALV), Delphi Automotive PLC (DLPH), Ford Motor Company (F), General Motors Company (GM), Lear Corporation (LEA), Mobileye NV (MBLY), Takata Corporation (7312 JP)

Highlights

The presenter is short shares of Autoliv (ALV) and sees meaningful downside risk (30-40%) for the stock based on a combination of macro headwinds for the auto sector and company-specific issues. Bulls have bid ALV up on the news that the company is one of the finalists (with Key Safety Systems being the other) in the bidding for Takata’s business, but any actual upside from the transaction - which is not a done deal - should be baked in at $113 (up almost $20 since early November). He provided a brief overview of his negativity on the auto sector (a peak price/ margin story), and then explained how ALV could see margins compress and its relatively rich multiple (16x consensus) contract over the next 12-18 months as earnings come in 10% below the Street’s 2017 estimate of $7.15/ share, which is what he is modeling.

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Idea Discussion

Commentor 1 - 2 weeks ago

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