Schaeffler (SHA0) AI Stock Analysis

• Market Cap: €9.43B
• Dividend Yield: 3.15%
• Average Volume (3M): 738.17K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.10
• Revenue Growth: 45.16%
• EPS Growth: -790.24%
• Country: DE
• Employees: 113,682
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Parts
• EPS (TTM): -0.30
• Shares Outstanding: 944,884,640
• 10 Day Avg. Volume: 821,042
• 30 Day Avg. Volume: 738,171
• PEG Ratio: 0.02
• Price to Book (P/B): 0.82
• Price to Sales (P/S): 0.17
• P/FCF Ratio: 7.21
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €9.04
• Price Target Upside: -9.42% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 52 Neutral
• Price Target: €10.00 ▲(0.20% Upside)

Overall score is held back primarily by weak profitability and high leverage despite improving revenue and free cash flow. Technicals provide modest support with a positive longer-term trend and neutral momentum. Valuation is constrained by a negative P/E, partially offset by a moderate dividend yield.

Positive Factors

Diversified OEM and aftermarket revenue plus R&D investment

Schaeffler's dual revenue model — direct OEM sales and a sizable aftermarket — plus ongoing R&D investment supports recurring demand and product renewal cycles. This diversity reduces single-customer concentration risk and underpins long-term resilience across automotive and industrial end markets.

Sustained revenue growth (TTM +8.59%)

Consistent top-line expansion indicates ongoing market penetration and product demand across Automotive and Industrial segments. Over a multi-month horizon, steady revenue growth enhances capacity to fund innovation and scale operations, making the business less vulnerable to short-term cyclical dips.

Improved free cash flow generation (TTM +71.8%)

A large increase in free cash flow strengthens the firm's ability to fund capex, R&D, and deleveraging without relying solely on external financing. Durable FCF expansion supports strategic investments and provides flexibility to navigate capital-intensive automotive and industrial cycles over the coming months.

Negative Factors

High financial leverage (debt-to-equity 2.40)

A debt-to-equity ratio of 2.40 signals substantial reliance on debt financing, which constrains financial flexibility and raises interest coverage risk. In cyclical auto and industrial markets, elevated leverage limits the company's ability to invest or absorb downturns without increasing refinancing or liquidity stress.

Weak profitability and declining margins

Negative net margins and falling EBIT/EBITDA margins point to structural cost or mix pressures that erode returns. Persistent margin weakness undermines cash generation sustainability and indicates the company may face competitive pricing, input-cost, or operational-efficiency challenges that reduce long-term earnings power.

Negative return on equity (-23.43%)

A -23.43% ROE reflects poor capital allocation and indicates the business is destroying shareholder value. Over multiple quarters this undermines investor confidence and limits the firm's ability to raise equity on favorable terms, constraining strategic initiatives and long-term growth funding.

Schaeffler Business Overview & Revenue Model

Company Description

Schaeffler AG, together with its subsidiaries, develops, manufactures, and sells components and system for industrial applications in Europe, the Americas, China, and the Asia Pacific. The Automotive Technologies division offers mechanical, mechatronic, and electronic components and systems for powertrain electrification used in passenger cars and commercial vehicles, such as electric motors, axle transmissions, axle drives, power electronics, hybrid modules, electromechanical and hydraulic actuators, and thermal management module; torque converters, hybrid dampers, clutches, variable valve train systems, valve-lash adjustment elements, balancer shafts, camshaft phasing systems, timing drives, and front end auxillary drives. This division provides rolling bearing application and products, such as wheel, ball, and needle roller bearings; and mechanical components and mechatronic systems for steering and other chassis applications, including Space Drive, a steer-by-wire system. The Automotive Aftermarket division offers components and repair solutions for light commercial vehicles, trucks and buses, and offroad sectors under the LuK, INA, and FAG brand names, as well as service for repair shops under the REPXPERT brand. The Industrial division develops and manufactures rotary and linear bearing solutions, drive technology components and systems, and service solutions, such as sensor-based condition monitoring systems. This division serves customers in the wind, raw materials, aerospace, rail, offroad, two wheelers, power transmission, and industrial automation sectors. The company was formerly known as INA Beteiligungsgesellschaft mit beschränkter Haftung and changed its name to Schaeffler AG in October 2014. The company was founded in 1946 and is headquartered in Herzogenaurach, Germany. Schaeffler AG is a subsidiary of IHO Verwaltungs GmbH.

How the Company Makes Money

Schaeffler generates revenue primarily through the sale of its automotive and industrial products. The company's revenue model is based on both direct sales to original equipment manufacturers (OEMs) and the aftermarket, where it provides replacement parts and services. Key revenue streams include automotive components for electric vehicles, internal combustion engines, and hybrid systems, as well as industrial solutions for sectors like renewable energy, rail, and machine tools. Significant partnerships with major automotive manufacturers enhance its market presence and contribute to stable earnings. Additionally, Schaeffler invests in research and development to innovate and expand its product offerings, which drives long-term growth and profitability.

Schaeffler Financial Statement Overview

Summary

Mixed fundamentals: revenue growth is solid (TTM +8.59%) and free cash flow growth is strong (TTM +71.8%), but profitability is weak (net margin -3.92%) with declining EBIT/EBITDA margins. Balance sheet leverage is high (debt-to-equity 2.40) and returns are negative (ROE -23.43%), raising financial stability risk.

Income Statement

Schaeffler's income statement shows a mixed performance. The TTM (Trailing-Twelve-Months) revenue growth rate is strong at 8.59%, indicating positive sales momentum. However, the company is struggling with profitability, as evidenced by a negative net profit margin of -3.92% and declining EBIT and EBITDA margins. This suggests challenges in cost management and operational efficiency.

Balance Sheet

The balance sheet reveals high leverage with a debt-to-equity ratio of 2.40 in the TTM period, indicating significant reliance on debt financing. The negative return on equity of -23.43% highlights profitability issues, while the equity ratio is relatively low, suggesting potential financial instability.

Cash Flow

Cash flow analysis shows a robust free cash flow growth rate of 71.8% in the TTM period, reflecting improved cash generation. However, the operating cash flow to net income ratio is low at 0.19, indicating that cash flow from operations is not sufficiently covering net income, which could be a concern for sustainability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	23.63B	18.19B	16.31B	15.81B	13.85B	12.59B
Gross Profit	4.49B	3.83B	3.55B	3.58B	3.44B	2.86B
EBITDA	1.61B	1.47B	1.70B	1.96B	2.21B	1.03B
Net Income	-1.13B	-632.00M	310.00M	557.00M	756.00M	-428.00M
Balance Sheet
Total Assets	21.32B	21.37B	15.02B	14.28B	14.36B	13.51B
Cash, Cash Equivalents and Short-Term Investments	2.18B	1.11B	834.00M	908.00M	1.66B	1.61B
Total Debt	7.75B	6.73B	4.19B	3.50B	3.99B	4.24B
Total Liabilities	18.20B	17.40B	11.10B	10.14B	11.20B	11.49B
Stockholders Equity	2.98B	3.81B	3.77B	4.02B	3.05B	1.93B
Cash Flow
Free Cash Flow	421.00M	433.00M	410.00M	348.00M	605.00M	621.00M
Operating Cash Flow	1.43B	1.39B	1.35B	1.14B	1.28B	1.25B
Investing Cash Flow	-702.00M	-2.08B	-1.90B	-990.00M	-716.00M	-642.00M
Financing Cash Flow	753.00M	1.19B	276.00M	-891.00M	-527.00M	526.00M

Schaeffler Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 9.98
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:SHA0, the sentiment is Neutral. The current price of 9.98 is below the 20-day moving average (MA) of 10.20, above the 50-day MA of 8.51, and above the 200-day MA of 5.99, indicating a neutral trend. The MACD of 0.75 indicates Positive momentum. The RSI at 51.32 is Neutral, neither overbought nor oversold. The STOCH value of 32.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DE:SHA0.

Schaeffler Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KBX	70 Neutral	€15.87B	36.48	14.52%	1.85%	-1.77%	-28.68%
SFQ	68 Neutral	€770.80M	13.83	11.63%	5.70%	-12.01%	-28.10%
HLE	62 Neutral	€9.07B	56.08	5.24%	1.17%	<0.01%	-50.97%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
CON	58 Neutral	€13.33B	54.11	-1.10%	2.88%	-38.10%	-75.32%
SHA0	52 Neutral	€9.43B	-6.68	-34.39%	3.15%	45.16%	-790.24%
ZIL2	46 Neutral	€269.91M	-2.35	-16.55%	3.51%	-6.21%	-995.53%