Magna downgraded to Sell from Neutral at Goldman Sachs

Goldman Sachs downgraded Magna (MGA) to Sell from Neutral with a price target of $41, down from $42. The firm contends that the company’s above average exposure to European auto OEMs and limited sales to faster-growing Chinese domestic OEMs like BYD, along with the relatively lower content per vehicle growth compared to its broader tier 1 coverage, will lead to slower revenue growth for Magna, the analyst tells investors in a research note. Given the more muted revenue growth, it will also be more difficult for Magna to reach its margin expansion targets, Goldman Sachs states. Magna has been investing for growth in megatrend areas, but its business has been affected by slower BEV ramps from key customers including Ford (F) and GM (GM), the firm added.