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Autoliv (ALV)
NYSE:ALV
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Autoliv
(NYSE:ALV)74Outperform
Positive Factors
Market Position
Autoliv remains one of the preferred automotive supplier exposures, led by its margin expansion profile and leading position in passive safety with a 45% market share.
Valuation
Autoliv trades at a 20% discount to its historical average, presenting a potential investment opportunity.
Negative Factors
Revenue Performance
Q4 revenue missed expectations due to underperformance in global light vehicle production and a deterioration in regional/customer mix.
Autoliv (ALV) vs. S&P 500 (SPY)
Market Cap
$7.19B
Dividend Yield2.96%
Average Volume (3M)854.31K
Price to Earnings (P/E)11.5
Beta (1Y)1.01
Revenue Growth-0.80%
EPS Growth39.95%
CountryUS
Employees65,200
SectorConsumer Cyclical
Sector Strength53
IndustryVehicles
Share Statistics
EPS (TTM)8.05
Shares Outstanding77,714,400
10 Day Avg. Volume782,379
30 Day Avg. Volume854,311
Financial Highlights & Ratios
PEG Ratio0.29
Price to Book (P/B)N/A
Price to Sales (P/S)0.69
Price to Cash Flow (P/CF)4.30
P/FCF Ratio4.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$113.64Price Target Upside15.95% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
Autoliv Business Overview & Revenue Model
Company DescriptionAutoliv, Inc. engages in the development, manufacture, and supply of automotive safety systems. It operates through the Passive Safety and Electronics segment. The Passive Safety segment includes airbags, seatbelts, steering wheels, and restrain electronics. The Electronics segment comprises of restraint control systems, brake control systems and active safety. The company was founded by Lennart Lindblad in 1953 and is headquartered in Stockholm, Sweden.
How the Company Makes MoneyAutoliv makes money primarily through the sale of automotive safety systems and components to global automotive manufacturers. The company's revenue streams are largely driven by its contracts and partnerships with original equipment manufacturers (OEMs) who integrate Autoliv's products into their vehicles. As safety regulations become more stringent and consumer demand for safer vehicles increases, Autoliv benefits from a growing market for advanced safety technologies. Additionally, the company invests in research and development to innovate and expand its product offerings, which helps maintain its competitive edge and secure long-term contracts with car manufacturers. Key factors contributing to its earnings include its strong relationships with OEMs, a comprehensive portfolio of safety solutions, and a global manufacturing presence that allows it to efficiently serve a diverse customer base.
Autoliv Financial Statement Overview
Summary
Autoliv demonstrates robust financial performance with revenue growth and improved profitability. The balance sheet shows moderate financial stability with manageable leverage, while cash flow generation is strong. However, potential risks include reliance on debt and capital expenditure fluctuations.Income Statement
Autoliv shows consistent revenue growth, with a notable increase from $7.44B in 2020 to $10.39B in 2024. The gross profit margin improved to 18.55% in 2024, indicating efficient cost management. The net profit margin also increased to 6.22% in 2024, reflecting better profitability. However, EBITDA margin slightly decreased from previous levels, suggesting room for operational improvements.78
Positive
Balance Sheet
The company's debt-to-equity ratio stands at 0.89 in 2024, showing a manageable level of leverage. The equity ratio is 29.16%, indicating moderate financial stability. Return on Equity (ROE) improved to 28.39% in 2024, highlighting enhanced shareholder returns. However, the lower equity ratio suggests potential risk if liabilities increase.70
Positive
Cash Flow
Autoliv's free cash flow grew significantly, with a strong operating cash flow to net income ratio of 1.64 in 2024. The free cash flow to net income ratio improved to 1.64, indicating healthy cash generation. Despite this, fluctuations in capital expenditures could impact future cash flow stability.75
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 10.39B | 10.47B | 8.84B | 8.23B | 7.45B | Gross Profit |
| 1.93B | 1.82B | 1.40B | 1.51B | 1.25B | EBIT |
| 979.00M | 690.00M | 659.00M | 675.00M | 382.10M | EBITDA |
| 979.00M | 1.08B | 1.03B | 1.07B | 735.00M | Net Income Common Stockholders |
| 646.00M | 488.00M | 423.00M | 435.00M | 187.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 330.00M | 498.00M | 594.00M | 969.00M | 1.18B | Total Assets |
| 7.80B | 8.33B | 7.72B | 7.54B | 8.16B | Total Debt |
| 2.07B | 2.04B | 1.92B | 2.14B | 2.55B | Net Debt |
| 1.74B | 1.54B | 1.33B | 1.17B | 1.37B | Total Liabilities |
| 5.52B | 5.76B | 5.09B | 4.89B | 5.73B | Stockholders Equity |
| 2.28B | 2.56B | 2.61B | 2.63B | 2.41B |
| Cash Flow | Free Cash Flow | |||
| 480.00M | 409.00M | 128.00M | 296.00M | 509.30M | Operating Cash Flow |
| 1.06B | 982.00M | 713.00M | 754.00M | 848.90M | Investing Cash Flow |
| -563.00M | -569.00M | -485.00M | -454.00M | -339.60M | Financing Cash Flow |
| -680.00M | -490.00M | -531.00M | -469.00M | 160.10M |
Autoliv Technical Analysis
Positive
98.01
Price Trends
96.11
Positive
96.28
Positive
99.85
Negative
Market Momentum
-0.04
Positive
52.93
Neutral
34.90
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALV, the sentiment is Positive. The current price of 98.01 is above the 20-day moving average (MA) of 96.14, above the 50-day MA of 96.11, and below the 200-day MA of 99.85, indicating a neutral trend. The MACD of -0.04 indicates Positive momentum. The RSI at 52.93 is Neutral, neither overbought nor oversold. The STOCH value of 34.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ALV.
Autoliv Risk Analysis
Autoliv disclosed 44 risk factors in its most recent earnings report. Autoliv reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Autoliv Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $480.65M | 2.97 | 11.02% | 9.21% | -11.02% | -51.66% | |
77 Outperform | $2.25B | 8.82 | 24.17% | ― | -2.23% | -42.94% | |
74 Outperform | $7.19B | 11.51 | 26.69% | 2.96% | -0.80% | 39.95% | |
71 Outperform | $4.79B | 9.95 | 17.69% | 3.45% | -0.70% | -7.27% | |
62 Neutral | $6.15B | 18.70 | 6.11% | 1.53% | -11.10% | -46.32% | |
60 Neutral | $13.01B | 10.45 | 0.79% | 3.53% | 1.60% | -22.47% |
* Consumer Cyclical Sector Average
Performance Comparison
ALV
Autoliv
98.01
-17.05
-14.82%
BWA
BorgWarner
29.19
-2.33
-7.39%
LEA
Lear
94.11
-42.17
-30.94%
MGA
Magna International
36.81
-14.99
-28.94%
TEN
Tsakos Energy Navigation
15.91
-6.06
-27.58%
VC
Visteon
86.55
-29.42
-25.37%
Autoliv Earnings Call Summary
Earnings Call Date: Jan 31, 2025 | % Change Since: -3.27% | Next Earnings Date: Apr 16, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a mixed sentiment, with several record-breaking achievements and strong shareholder returns being key highlights. However, the call also noted challenges such as sales decline, negative mix impact, and industry uncertainties, particularly in North America and Europe.Highlights
Record-Breaking Quarter and Financial Performance
Achieved record highs in operating profit, operating margin, earnings per share, and operating cash flow for the full year 2024 despite market headwinds. The adjusted operating margin was 13.4%, and operating cash flow was $420 million for Q4.
Strong Shareholder Returns
Returned over $770 million to shareholders in 2024 through dividends and share buybacks. The number of outstanding shares was reduced by over 12% since the current stock repurchase program began in 2022.
Improved Efficiency and Cost Control
Reduced indirect workforce by 1,400 and direct headcount by 4,500, enhancing operating efficiency. Achieved $57 million in operational improvements in Q4 driven by cost control and improved calloff accuracy.
Growth in Asian Markets
Strong performance and market position in Asia, with significant growth from Chinese and Indian OEMs. The content per vehicle in India is expected to rise significantly in 2025.
Lowlights
Sales Decline
Sales in Q4 decreased by 5% year-over-year due to factors such as negative currency translation and light vehicle production development.
Challenges in North America and Europe
Anticipated challenging market conditions in North America and Europe due to economic uncertainties, inventory adjustments, and potential tariffs.
Order Intake Decline
2024 saw the lowest level of industry sourcing of new business since 2018, driven by technological and geopolitical uncertainties.
Negative Mix Impact
Experienced negative mix impact due to regional and customer mix developments, with a 4 percentage point unfavorable mix in Q4.
Company Guidance
During the Autoliv Inc. Fourth Quarter and Full Year 2024 Financial Results Conference Call, the company reported record-breaking performance in several areas. Despite a 5% year-over-year decline in fourth-quarter sales, the adjusted operating income increased by 5% to $349 million, with an operating margin of 13.4%, a company record. For the full year, Autoliv achieved a record high operating cash flow of $1.1 billion and returned over $770 million to shareholders. The reduction of indirect and direct workforce by 1,400 and 4,500 employees, respectively, contributed significantly to these results. The company also cited successful agreements with major customers on excess inflation compensation as supportive of its strong cash flow. Looking ahead, Autoliv anticipates a 2% organic sales growth in 2025, despite a forecasted 0.5% decline in global light vehicle production, and expects improved profitability with an adjusted operating margin target of 10% to 10.5%.Autoliv Corporate Events
Business Operations and StrategyFinancial Disclosures
Autoliv Reports Record Profits Despite Sales Decline
Positive
Jan 31, 2025
On January 31, 2025, Autoliv announced its financial results for the fourth quarter of 2024, highlighting a record operating profit, margin, and earnings per share despite a 4.9% decrease in net sales. The company credited these achievements to successful cost reductions and commercial recoveries, which led to a 7% reduction in total headcount and improved profitability. Although Autoliv underperformed in certain regions like China due to a negative LVP mix, it anticipates improvement in 2025 with a record number of new launches expected in the Chinese market. The company’s strong performance is seen as a result of strategic cost control and agreements with major customers on inflation compensation, setting a solid foundation for future growth despite anticipated industry challenges.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.