Dana Holding stock rating upgraded by CFRA to Hold on margin improvement

Published 05/08/2025, 20:54
Dana Holding stock rating upgraded by CFRA to Hold on margin improvement

Investing.com - CFRA has upgraded Dana Holding (NYSE:DAN) from Sell to Hold and raised its price target to $16.00 from $10.00 following the company’s better-than-expected second-quarter results. According to InvestingPro data, the stock has gained nearly 35% year-to-date, with analysts setting price targets ranging from $17 to $25.

The research firm cited significant margin improvement in Dana’s remaining business segments, which saw a 210 basis point year-over-year increase to 7.5% in the second quarter, substantially exceeding expectations. The company’s current ratio of 1.43 indicates strong short-term liquidity, with InvestingPro analysis showing liquid assets exceeding short-term obligations.

CFRA raised its adjusted earnings per share estimates for Dana to $1.45 from $1.25 for 2025 and to $1.55 from $1.25 for 2026, based on a 2026 price-to-earnings ratio of 10.3x, which represents a discount to historical averages. This aligns with broader analyst sentiment, as InvestingPro data shows four analysts have recently revised their earnings expectations upward, with net income projected to grow this year.

The firm noted that Dana’s planned share repurchases and debt retirement activities are expected to reduce the company’s year-end share count by approximately 25%, while bringing its net leverage ratio down to only 0.7x.

Despite initial concerns about the financial impact of Dana’s upcoming divestiture of its Off-Highway segment, which represented approximately 43% of total adjusted EBITDA in the second quarter, CFRA believes the $2.7 billion sale will continue to positively transform the company.

In other recent news, Dana Inc reported its Q2 2025 earnings on August 5, showcasing a strong performance with an earnings per share (EPS) that exceeded analyst expectations. However, the company’s revenue did not meet projections, presenting a mixed financial picture. Despite the revenue shortfall, the positive EPS results have generated optimism among investors. Analysts have taken note of Dana Inc’s earnings performance, and their assessments may influence future investor sentiment. The earnings announcement has been a focal point for those following the company’s financial health. These recent developments are critical for investors evaluating their positions in Dana Inc. The market’s reaction to the earnings report highlights its significance.

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