Linamar, the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Michael Glen from Raymond James maintained a Hold rating on the stock and has a C$85.00 price target.
TipRanks Cyber Monday Sale
- Claim 60% off TipRanks Premium for data-backed insights and research tools you need to invest with confidence.
- Subscribe to TipRanks' Smart Investor Picks and see our data in action through our high-performing model portfolio - now also 60% off
Michael Glen has given his Hold rating due to a combination of factors influencing Linamar’s performance. The company’s third-quarter results showed a mixed performance across different segments. The Automotive/Mobility segment performed significantly better than expected, driven by improved program launches and solid volumes, which are seen as sustainable. However, the Industrial segment, particularly the agriculture lines, faced substantial pressure due to weak market conditions and low crop prices, which are expected to persist until 2027.
Despite the strong free cash flow generation and substantial liquidity, which positions Linamar well for potential acquisitions, the overall outlook remains cautious. The anticipated seasonal decline in the fourth quarter and potential supply chain issues could offset some of the gains seen in the Mobility segment. Additionally, while Linamar has renewed its share repurchase program, no repurchases were made in the third quarter, indicating a conservative approach. These factors contribute to the Hold rating, as the company’s future performance hinges on overcoming these challenges.
Glen covers the Consumer Cyclical sector, focusing on stocks such as Aritzia, Linamar, and MTY Food Group. According to TipRanks, Glen has an average return of 16.4% and a 60.69% success rate on recommended stocks.