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Strattec Security Corp. (STRT)
NASDAQ:STRT
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Strattec Security
(NASDAQ:STRT)
77Outperform
Strattec Security (STRT) vs. S&P 500 (SPY)
Market Cap
$165.97M
Dividend YieldN/A
Average Volume (3M)28.05K
Price to Earnings (P/E)9.9
Beta (1Y)1.51
Revenue Growth7.69%
EPS Growth7934.59%
CountryUS
Employees3,365
SectorConsumer Cyclical
Sector Strength50
IndustryAuto - Parts
Share Statistics
EPS (TTM)4.00
Shares Outstanding4,172,217
10 Day Avg. Volume17,472
30 Day Avg. Volume28,052
Financial Highlights & Ratios
PEG Ratio0.00125
Price to Book (P/B)N/A
Price to Sales (P/S)0.32
Price to Cash Flow (P/CF)4.70
P/FCF Ratio4.60
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Strattec Security Business Overview & Revenue Model
Company DescriptionStrattec Security Corporation designs, develops, manufactures, and markets automotive access control products under the VAST Automotive Group brand primarily in North America. The company offers mechanical and electronically enhanced locks and keys, passive entry passive start systems, steering column and instrument panel ignition lock housings, latches, power sliding side door systems, power tailgate and lift gate systems, power deck lid systems, door handles, and related products. It also provides full service and aftermarket support services for its products. The company markets its products to automotive and light truck original equipment manufacturers, as well as other transportation-related manufacturers; and through wholesale distributors, other marketers, and users of component parts, as well as certain products to non-automotive commercial customers. It also exports its products to Europe, South America, Korea, China, and India. Strattec Security Corporation was founded in 1908 and is headquartered in Milwaukee, Wisconsin.
How the Company Makes MoneyStrattec Security makes money primarily through the sale of its access control products to original equipment manufacturers (OEMs) in the automotive sector. Its revenue streams are driven by contracts and partnerships with major car manufacturers, where it supplies components such as locks, keys, and other security systems that are integral to vehicle assembly. Strattec also benefits from aftermarket sales, where it provides replacement parts and services. In addition, the company engages in collaborative ventures with industry partners to enhance its product offerings and expand its market reach, thereby contributing to its earnings.
Strattec Security Financial Statement Overview
Summary
Strattec Security exhibits a commendable financial position with improving revenues and profitability, a debt-free balance sheet, and strong cash flows. The company is well-positioned for future growth with efficient cost management and liquidity. While the slight decline in the EBITDA margin and total assets warrants monitoring, the overall financial health is strong, providing a solid foundation for strategic expansion.Income Statement
Strattec Security's income statement shows solid growth, with revenue increasing from $492.9M in 2023 to $552.8M in TTM (Trailing-Twelve-Months), a growth rate of 12.13%. The gross profit margin improved to 12.54%, indicating efficient production cost management. The net profit margin turned positive to 2.92% after a previous loss, reflecting improved profitability. However, the EBITDA margin decreased slightly from 7.01% to 4.67%, suggesting rising operating expenses.75
Positive
Balance Sheet
The balance sheet is robust, with a strong equity position, as shown by an equity ratio of 58.39%. The company has no debt, reducing financial risk, and a healthy return on equity of 7.89%. The increase in cash reserves enhances liquidity, supporting future investments and operations. However, the total assets decreased slightly, which could be a potential concern if it continues.80
Positive
Cash Flow
Strattec's cash flow is strong, with free cash flow increasing significantly to $31.58M from $2.48M annually, a growth rate of 1172.58%. The operating cash flow to net income ratio is robust at 2.47, indicating strong cash conversion. The company effectively manages its capital expenditures, enhancing free cash flow, which supports financial stability and growth opportunities.85
Very Positive
| Breakdown | |||||
| TTM | Jun 2024 | Sep 2023 | Sep 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 552.80M | 537.77M | 492.95M | 452.26M | 485.30M | 385.30M | Gross Profit |
| 69.32M | 65.47M | 42.15M | 56.02M | 78.66M | 35.45M | EBIT |
| 18.85M | 17.81M | -6.09M | 8.90M | 33.91M | -7.20M | EBITDA |
| 30.75M | 37.65M | 10.78M | 28.86M | 55.10M | 12.13M | Net Income Common Stockholders |
| 16.15M | 16.31M | -6.67M | 7.02M | 22.53M | -5.86M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 15.20M | 25.41M | 20.57M | 8.77M | 14.46M | 11.77M | Total Assets |
| 140.28M | 364.29M | 340.93M | 318.68M | 310.56M | 265.55M | Total Debt |
| 0.00 | 13.00M | 13.00M | 11.00M | 12.00M | 35.00M | Net Debt |
| -15.20M | -12.41M | -7.57M | 2.23M | -2.46M | 23.23M | Total Liabilities |
| 63.95M | 138.67M | 129.91M | 98.27M | 97.13M | 90.10M | Stockholders Equity |
| 74.93M | 200.54M | 184.96M | 188.87M | 181.65M | 152.22M |
| Cash Flow | Free Cash Flow | ||||
| 31.57M | 2.48M | -7.28M | -3.75M | 26.22M | 13.04M | Operating Cash Flow |
| 39.96M | 12.27M | 10.10M | 10.44M | 35.15M | 25.42M | Investing Cash Flow |
| -8.38M | -7.79M | 8.90M | -14.33M | -9.02M | -12.35M | Financing Cash Flow |
| 63.00K | 72.00K | -7.44M | -1.89M | -22.89M | -8.99M |
Strattec Security Technical Analysis
Negative
39.78
Price Trends
43.60
Negative
42.19
Negative
37.34
Positive
Market Momentum
-1.01
Positive
35.82
Neutral
12.67
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STRT, the sentiment is Negative. The current price of 39.78 is below the 20-day moving average (MA) of 43.89, below the 50-day MA of 43.60, and above the 200-day MA of 37.34, indicating a neutral trend. The MACD of -1.01 indicates Positive momentum. The RSI at 35.82 is Neutral, neither overbought nor oversold. The STOCH value of 12.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for STRT.
Strattec Security Risk Analysis
Strattec Security disclosed 21 risk factors in its most recent earnings report. Strattec Security reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Strattec Security Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $165.97M | 9.94 | 8.16% | ― | 7.69% | 7934.59% | |
70 Outperform | $843.93M | 13.28 | 10.30% | ― | -0.88% | 67.38% | |
66 Neutral | $6.93B | 11.11 | 26.69% | 3.07% | -0.80% | 39.95% | |
64 Neutral | $4.72B | 9.81 | 10.81% | 3.50% | -0.70% | -7.27% | |
62 Neutral | $6.19B | 18.75 | 6.46% | 1.56% | -11.10% | -46.32% | |
59 Neutral | $12.26B | 11.12 | -0.55% | 3.78% | 1.42% | -20.63% | |
59 Neutral | $5.32B | 13.26 | 16.69% | 2.05% | 0.61% | -4.04% |
* Consumer Cyclical Sector Average
Performance Comparison
STRT
Strattec Security
39.78
15.72
65.34%
ALV
Autoliv
89.23
-28.19
-24.01%
BWA
BorgWarner
28.19
-6.39
-18.48%
GNTX
Gentex
23.30
-12.29
-34.53%
LEA
Lear
87.96
-52.32
-37.30%
THRM
Gentherm
27.41
-28.65
-51.11%
Strattec Security Earnings Call Summary
Earnings Call Date: Feb 6, 2025 | % Change Since: 4.00% | Next Earnings Date: Apr 24, 2025
Earnings Call Sentiment Positive
The earnings call presented a generally positive outlook with significant improvements in cash flow, revenue, and margins, alongside strategic pricing gains and product line growth. However, challenges such as increased labor costs and declines in sales to specific customers were acknowledged, alongside the uncertainties posed by tariffs.Highlights
Strong Cash Flow from Operations
Generated $9.4 million in cash from operations during the quarter, totaling approximately $21 million for the first half of the fiscal year, a significant improvement over the previous year.
Revenue Growth
Revenue grew almost 10% despite the previous year's quarter benefiting from $4 million in retroactive pricing.
Margin Improvement
Adjusted EBITDA margin expanded by 180 basis points.
New Annualized Pricing Captured
Captured about $8 million in new annualized pricing, expected to begin realizing in the third quarter.
Strong Performance in Power Access and Engineered Latches
Sales of power access products increased by 27% year over year, and engineered latches grew by 20%.
Net Income Increase
Net income for the second quarter rose by 29% to $1.3 million.
Adjusted EBITDA Growth
Adjusted EBITDA for the quarter was $8 million, up 60% compared to the previous year.
Lowlights
Increased Labor Costs
Labor costs rose by $1.4 million due to a 20% government-mandated wage increase in Mexico.
Stellantis Sales Decline
Sales to Stellantis were down about 10% year over year in the quarter.
Tariff Uncertainty
Ongoing concerns about tariffs affecting the automotive industry, with potential implications for strategic evaluation.
Company Guidance
During the second quarter of fiscal year 2025, Strattec Security Corporation demonstrated solid financial performance and strategic progress. The company generated $9.4 million in cash from operations, contributing to a total of approximately $21 million in cash flow for the first half of the fiscal year. Revenue increased by almost 10%, and adjusted EBITDA margin expanded by 180 basis points. Notably, power access product sales surged by 27% year-over-year, while engineered latches grew by 20%, offsetting declines in key and lockset sales. The company achieved $8 million in new annualized pricing, anticipated to take effect in the third quarter. Additionally, Strattec reduced its preproduction tooling cost balances by $10.5 million, nearly halving the amount since the fiscal year's start. Gross profit rose by 27% to $17.2 million, benefiting from favorable foreign exchange and higher production volumes. Adjusted EBITDA for the quarter was $8 million, reflecting a 60% increase from the previous year, with an adjusted EBITDA margin of 6.1%. Strattec ended the quarter with $42.6 million in cash, emphasizing operational efficiencies and organic growth as key capital priorities.Strattec Security Corporate Events
Business Operations and StrategyFinancial Disclosures
Strattec Security Reports Revenue Growth in Q2 2025
Positive
Feb 6, 2025
On February 6, 2025, STRATTEC Security Corporation announced its fiscal second-quarter results for 2025, highlighting a revenue increase to $129.9 million driven by new program launches and customer demand. The company reported a net income of $1.3 million and significant cash generation from operations. The quarter also saw efforts in restructuring U.S. manufacturing operations and investments in talent and leadership to support strategic objectives, with a focus on profitability and market opportunities.
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.