EU and US could reach trade deal this weekend - Reuters
Investing.com - BWS Financial has reiterated its Buy rating and $14.00 price target on Garrett Motion (NASDAQ:GTX) amid favorable currency movements and limited exposure to U.S. trade uncertainties. The target represents a 41% upside from the current price of $9.93, with InvestingPro analysis indicating the stock is currently undervalued.
The second quarter of 2025 has seen concerns shift from tariffs to consumer demand for automobiles, while the U.S. dollar has weakened against the euro during this period, according to BWS Financial. These developments could help Garrett Motion, which generates $3.44 billion in annual revenue and maintains a healthy 20.71% gross margin, exceed the firm’s quarterly estimates.
The automotive industry has maintained stability since April’s headline fluctuations, with Garrett Motion having less than 20 percent exposure to the U.S. market, primarily in commercial vehicles, which reduces its vulnerability to American trade uncertainties.
BWS Financial notes that the strengthening euro could potentially boost Garrett Motion’s sales by up to $100 million compared to scenarios with the euro at $1.05, though the firm isn’t making dramatic estimate changes due to second-quarter sales timing and possible lags in realizing the full benefits of currency movements.
New car sales have remained positive in international markets, suggesting Garrett Motion is experiencing steady order flow, according to the research firm’s analysis. InvestingPro data shows the company trading at an attractive P/E ratio of 9.27, with additional ProTips available for subscribers highlighting the company’s strong financial health and market position.
In other recent news, Garrett Motion Inc. announced a secondary public stock offering of 17 million shares held by affiliates of Oaktree Capital Management, Centerbridge Partners, and Cyrus Capital Partners (WA:CPAP). The underwriters, led by Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC, have a 30-day option to purchase an additional 2.55 million shares. Garrett Motion will not receive any proceeds from this offering but plans to repurchase approximately 2 million shares as part of its $250 million share repurchase program.
Additionally, Garrett Motion is introducing new E-technologies at Auto Shanghai 2025, showcasing advancements such as its 3-in-1 E-Powertrain and E-Cooling Compressor. These innovations aim to enhance energy efficiency and sustainability in zero-emission vehicles. The company has also announced a partnership with SinoTruk to develop a next-generation heavy-duty E-powertrain, with production targeted for 2027.
Garrett Motion’s Gen 3 Fuel Cell compressors, known for their efficiency and reliability, cater to the growing hydrogen economy. These developments underscore the company’s commitment to cleaner propulsion technologies across various vehicle types.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.