Nucor earnings beat by $0.08, revenue fell short of estimates
Investing.com - UBS lowered its price target on Lear (NYSE:LEA) to $109.00 from $116.00 on Monday, while maintaining a Neutral rating on the automotive seating and electrical systems supplier. Currently trading at $99.48, Lear’s analyst targets range from $88 to $136, with InvestingPro analysis indicating the stock is undervalued.
The firm cited ongoing volume and mix headwinds that continue to drag down margins, despite signs of underlying cost improvement at the company. This aligns with Lear’s current gross profit margin of 7.65%, though InvestingPro data shows the company maintains a "GOOD" overall financial health score. UBS noted that Lear’s earnings growth appears more dependent on further cost savings due to its "more challenged growth story."
On the positive side, UBS highlighted that Lear has won structures business on the next Ford F-150/250 models, which was not previously held by competitor Adient (NYSE:ADNT). This represents incremental business for Lear, though UBS characterized the metals component as "the toughest, riskiest part of seats."
UBS also mentioned that just-in-time (JIT) business for these Ford models remains out for bid. While Lear has a chance to win this business, UBS believes Adient remains the favorite for that portion of the contract.
The firm further noted that Lear is likely to retain its T1XX business that’s being resourced to the US, but expressed less certainty about other programs such as the Chevrolet Equinox. Despite these uncertainties, Lear has maintained dividend payments for 15 consecutive years, currently yielding 3.1%. Discover more insights about Lear and access comprehensive analysis with InvestingPro, which offers detailed Pro Research Reports for over 1,400 US stocks.
In other recent news, Lear Corporation announced its Q2 2025 earnings, which revealed mixed results. The company reported earnings per share (EPS) of $3.06, which was below the anticipated $3.26, resulting in a negative surprise of 6.13%. However, Lear’s revenue figures were more promising, reaching $6 billion and surpassing the expected $5.89 billion. This revenue achievement highlights a positive aspect of the company’s financial performance despite the EPS shortfall. The announcement led to a noticeable decline in Lear’s stock in after-hours trading. These developments come as analysts and investors continue to monitor the company’s financial health and market strategies. The earnings report provides a snapshot of Lear’s current financial standing and is a key point of interest for stakeholders.
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