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Gentex (GNTX)
NASDAQ:GNTX
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Gentex
(NASDAQ:GNTX)
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Rating:78Outperform
Price Target:
$27.00
▲(15.38% Upside)
Action:ReiteratedDate:02/28/26
The score is driven primarily by strong financial quality (notably the debt-free balance sheet and durable profitability) and a reasonable valuation with a solid dividend. The latest earnings call supports the outlook via margin progress and VOXX synergy targets, but meaningful tariff/commodity and China-related headwinds persist. Technically, the stock’s trend is weak (below key moving averages), which limits the overall score despite near-oversold signals.
Positive Factors
Debt-free balance sheet
Gentex’s zero-total-debt balance sheet and rising equity provide durable financial flexibility. This conservatism supports multi-year capital allocation (capex, buybacks, acquisitions), cushions cyclical auto downturns, and lowers solvency risk so management can fund strategic investments without stressing liquidity.
Strong cash generation
Consistent operating cash flow and positive free cash flow underpin sustainable funding for R&D, VOXX integration, dividends and buybacks. Reliable cash conversion improves resilience to industry cycles and funds content-upgrade programs that raise per-vehicle revenue over time.
Product & technology momentum
Increasing shipments of higher-content products (full display mirrors, driver monitoring systems, dimmable sun visors pipeline) and multiple OEM wins indicate sustained secular demand for advanced mirror/vision hardware. Higher content per vehicle strengthens pricing power and competitive differentiation long-term.
Negative Factors
Tariff and commodity headwinds
Persistent tariff and commodity cost exposure can structurally depress gross margins (~150 bps impact cited) until costs are recovered or mitigated. Given Gentex’s per-unit pricing model, prolonged trade frictions or metals inflation could force margin dilution or require costly OEM negotiations, reducing durable profitability.
China revenue exposure and decline
A near-30% annual decline in China sales highlights concentrated exposure to regional trade disruptions. Sustained China weakness reduces addressable OEM volume and depresses both revenue and scale-driven margins, making multi-quarter recovery uncertain if tariff or market-share issues persist.
Supply-chain & working-capital strain
Higher component costs (DRAM/memory) and substantial increases in AR/inventory have weighed on liquidity and free cash flow. Working-capital swings can persistently constrain cash available for investments or distributions, increase financing needs in down cycles, and complicate integration of acquisitions.
Gentex (GNTX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.04B
Dividend Yield2.05%
Average Volume (3M)2.31M
Price to Earnings (P/E)13.4
Beta (1Y)0.53
Revenue Growth2.99%
EPS Growth-9.80%
CountryUS
Employees6,184
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Parts
Share Statistics
EPS (TTM)0.43
Shares Outstanding215,402,360
10 Day Avg. Volume1,512,388
30 Day Avg. Volume2,310,822
Financial Highlights & Ratios
PEG Ratio-7.83
Price to Book (P/B)2.05
Price to Sales (P/S)2.02
P/FCF Ratio11.15
Enterprise Value/Market Cap0.99
Enterprise Value/Revenue1.96
Enterprise Value/Gross Profit5.74
Enterprise Value/Ebitda9.02
Forecast
1Y Price Target
$26.50Price Target Upside13.25% Upside
Rating ConsensusHold
Number of Analyst Covering4
EPS Forecast (FY)1.96
Revenue Forecast (FY)$2.67B
Gentex Business Overview & Revenue Model
Company DescriptionGentex Corporation designs, develops, manufactures, markets, and supplies digital vision, connected car, dimmable glass, and fire protection products in the United States, Germany, Japan, Mexico, and internationally. It operates through Automotive Products and Other segments. The company offers automotive products, including interior and exterior electrochromic automatic-dimming rearview mirrors, automotive electronics, and non-automatic-dimming rearview mirrors for automotive passenger cars, light trucks, pick-up trucks, sport utility vehicles, and vans for original equipment manufacturers, automotive suppliers, and various aftermarket and accessory customers. It also provides variable dimmable windows to aircraft manufacturers and airline operators. In addition, the company offers photoelectric smoke detectors and alarms, electrochemical carbon monoxide alarms and detectors, audible and visual signaling alarms, and bells and speakers used in fire detection systems in office buildings, hotels, and other commercial and residential buildings, as well as researches and develops nanofiber chemical sensing products. The company sells its fire protection products directly, as well as through sales managers and manufacturer representative organizations to fire protection and security product distributors, electrical wholesale houses, and original equipment manufacturers of fire protection systems. Gentex Corporation was incorporated in 1974 and is headquartered in Zeeland, Michigan.
How the Company Makes MoneyGentex generates revenue primarily through the sale of its automotive products, which include automatic-dimming mirrors and other electronic components that are often integrated into vehicles to enhance safety and comfort. The company has established strong relationships with major automotive manufacturers, which allows it to supply products for a wide range of vehicle models. In addition to the automotive sector, Gentex also earns revenue from its aerospace division, providing technologically advanced products for aircraft, including cockpit displays and lighting systems. The revenue model is further bolstered by ongoing investments in research and development to innovate and diversify its product offerings, as well as strategic partnerships with automotive and aerospace companies that enhance its market position and revenue potential.
Gentex Key Performance Indicators (KPIs)
Gentex Earnings Call Summary
Earnings Call Date:Jan 30, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 24, 2026
Earnings Call Sentiment Positive
Overall the call conveyed a positive operational and strategic progression: consolidated revenue and operating cash flow grew, management hit stated gross margin targets (core gross margin up materially), key product launches and customer wins advanced, and VOXX integration is progressing toward targeted synergies. Material headwinds remain — notably steep China revenue declines from tariffs, tariff-driven margin pressure (~150 bps in Q4), commodity and memory cost inflation, higher effective tax rate, and near-term working capital impacts. On balance, achievements in margin recovery, product commercialization, cash generation, and acquisition integration outweigh the lowlights, though the company faces tangible macro and supply-chain risks that could constrain near-term upside.Q4-2025 Updates
Positive Updates
Consolidated Revenue Growth (Q4 & FY)
Consolidated net sales for Q4 2025 were $644.4 million, up 19% year-over-year (voxx contributed $103.4M). Consolidated revenue for calendar year 2025 was $2.53 billion, up 10% versus $2.31 billion in 2024 (includes nine months of VOXX). Core Gentex Q4 revenue was $541 million and core Gentex full-year sales were $2.27 billion.
Significant Gross Margin Improvement
Consolidated gross margin in Q4 was 34.8% versus 32.5% last year (last year excluded VOXX). Core Gentex gross margin in Q4 was 35.5%, a 300 basis point improvement year-over-year and the highest since 2021. Core Gentex full-year gross margin was 34.7%, a 140 basis point increase versus prior year driven by favorable mix, operational efficiencies and purchasing cost reductions.
Stronger Profitability Metrics
Consolidated income from operations in Q4 was $120.1 million (versus $89.8M prior year). Core Gentex income from operations was $112.5 million, a 25.3% increase year-over-year. Consolidated Q4 net income was $93.0 million and EPS was $0.43 versus $0.39 last year (Q4).
Product Launches, Wins and Technology Momentum
Full display mirror shipments increased to 3.19 million units in 2025 (~8% increase vs 2024). Began shipping driver monitoring systems to Volvo and Polestar (and previously Rivian), and expect two additional OEM production programs in 2026. First customer launch for dimmable sun visors targeting 2027. CES showcase earned 26 awards across product lines including premium audio and new automotive technologies.
VOXX Acquisition Progress and Synergy Plan
VOXX contributed $267.2 million in revenue from April–Dec and $103.4 million in Q4. Integration is on track and management expects approximately $40 million per year in positive cash flow from VOXX cost improvements; management indicated they are roughly halfway to the targeted improvement entering 2026.
Strong Operating Cash Flow and Capital Deployment
Operating cash flow for 2025 was $587.3 million, up from $498.2 million in 2024. The company repurchased 13.6 million shares in 2025 for approximately $319 million (3.8M shares in Q4 at $23.43 average), with $35.9 million shares remaining under authorization.
Controlled CapEx and Depreciation Discipline
Net capital expenditures for the full year were $126 million versus $141.4 million in the prior year (Q4 CapEx $17.5M vs $38.0M prior year). Depreciation & amortization increased to $104.0 million for the year from $94.7 million as investment in product platforms continued.
Negative Updates
Severe China Revenue Decline
Sales into China for the quarter were $34.5 million, down 33% year-over-year due to tariff impacts. Management noted a ~29% year-over-year sales decline in China for the year, materially pressuring core Gentex sales and margins.
Tariff and Commodity Headwinds
Tariff-related costs reduced gross margin by approximately 150 basis points in Q4 versus last year. Management noted tariffs and commodity pressures (precious metals, copper, PCBs) represent a roughly $45–$50 million headwind entering 2026 (full-year impact).
Core Sales and Shipment Declines
Core Gentex full-year sales declined ~2% year-over-year to $2.27 billion. Auto-dimming mirror shipments fell 6% year-over-year for the full year, and Gentex Automotive net sales were slightly down ($2.22B in 2025 vs $2.26B in 2024).
Increased Operating Expenses and Other Losses
Consolidated operating expenses in Q4 were $104.4 million versus $86.5 million last year, primarily due to VOXX ($24.6M increase) and severance expenses. Total other loss was $8.7 million in Q4 versus other income of $8.0M last year; full-year other loss was $12.9M versus other income of $12.5M prior year.
Higher Effective Tax Rate
The effective tax rate increased to 16.3% in Q4 (from 10.3% prior year) and to 16.6% for the full year (from 14.3%), driven by lower tax benefits from stock-based compensation and reduced FDII deductions, raising tax expense versus prior periods.
Liquidity and Working Capital Changes
Cash and cash equivalents declined to $145.6 million at year-end (from $233.3M) driven by the VOXX acquisition and share repurchases. Accounts receivable increased to $368.5 million (from $295.3M) and consolidated inventory was $516.3 million (core Gentex inventory $392.2M). Preliminary Q4 operating cash flow was $125.7M versus $154.4M prior quarter due to working capital swings.
Supply Chain/Component Cost Pressures (DRAM & Memory)
Management reported elevated DRAM and memory pricing and some allocation risk (not a broad production stoppage but materially higher cost). Some products (DMS/DMS-related subsystems) use DDR3/DDR4 and face pricing pressure that will require negotiation with OEMs or other mitigation.
Full-Year Profitability Slightly Lower
Consolidated net income for 2025 was $384.8 million versus $404.5 million in 2024, and full-year diluted EPS was $1.74 versus $1.76 a year ago, indicating modest decline in net earnings despite consolidated revenue growth (fueled by acquisition).
Company Guidance
Management provided 2026 guidance of consolidated revenue of $2.6–$2.7 billion (based on S&P Global Mobility’s mid‑January 2026 LVP forecast for North America, Europe, Japan, Korea and China), consolidated gross margin of 34–35%, consolidated operating expenses excluding severance of $410–$420 million, an effective tax rate of 16–18%, capital expenditures of $125–$140 million, and depreciation & amortization of $100–$110 million; they also guided 2027 revenue of $2.75–$2.85 billion. Management said results assume mostly flat light‑vehicle production in primary markets, include incremental sales from the VOXX acquisition (with integration actions targeting roughly $40 million per year in positive cash flow), and warned of tariff and commodity headwinds (cited roughly $45–$50 million of headwinds entering the year).Gentex Financial Statement Overview
Summary
Strong overall fundamentals anchored by an exceptionally conservative, debt-free balance sheet (94) and solid profitability (84) with healthy margins. Cash generation is good (79) with positive free cash flow, but recent free-cash-flow softness and some margin moderation versus prior years temper the score.Income Statement
TTM (Trailing-Twelve-Months) revenue grew 4.2% with strong profitability: ~34.2% gross margin, ~18.7% operating margin, and ~15.2% net margin. However, profitability has moderated versus 2023–2024 (net margin down from ~18.6% in 2023 and ~17.5% in 2024), and growth has been uneven over time (including a revenue decline in 2020). Overall, the income statement reflects solid, consistent earnings power with some recent margin compression.84
Very Positive
Balance Sheet
The balance sheet is exceptionally conservative with zero total debt across all periods provided, supporting high financial flexibility and low solvency risk. Equity has steadily increased (to ~$2.49B in TTM), and returns on equity remain strong (~15.6% TTM; ~15–19% historically). The main limitation is that returns have drifted down from peak levels (e.g., ~18.5% in 2023), but overall balance-sheet quality is a major strength.94
Very Positive
Cash Flow
Cash generation is solid: TTM operating cash flow is ~$587M and free cash flow is ~$458M, with operating cash flow exceeding net income (about 1.19x), indicating good earnings quality. Free cash flow is meaningfully positive but conversion to free cash flow is moderate (free cash flow is ~0.78x net income TTM), and free cash flow growth has recently dipped (TTM down ~2.7%, following a flat-to-down profile in 2024). Overall, cash flow is healthy but less consistently growing than earnings and revenue.79
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.53B | 2.31B | 2.30B | 1.92B | 1.73B |
| Gross Profit | 866.71M | 771.09M | 762.63M | 609.81M | 619.71M |
| EBITDA | 566.14M | 563.31M | 589.05M | 466.57M | 508.89M |
| Net Income | 384.84M | 404.49M | 428.40M | 318.76M | 360.80M |
Balance Sheet | |||||
| Total Assets | 2.93B | 2.76B | 2.68B | 2.39B | 2.13B |
| Cash, Cash Equivalents and Short-Term Investments | 151.03M | 255.62M | 240.79M | 241.76M | 267.74M |
| Total Debt | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Total Liabilities | 437.66M | 288.72M | 365.67M | 323.58M | 193.40M |
| Stockholders Equity | 2.49B | 2.47B | 2.31B | 2.07B | 1.94B |
Cash Flow | |||||
| Free Cash Flow | 458.04M | 353.54M | 353.57M | 191.77M | 293.33M |
| Operating Cash Flow | 587.13M | 498.21M | 537.25M | 338.20M | 362.17M |
| Investing Cash Flow | -266.90M | -202.08M | -299.42M | -172.74M | -113.11M |
| Financing Cash Flow | -407.90M | -289.25M | -230.15M | -209.02M | -410.12M |
Gentex Technical Analysis
Negative
23.40
Price Trends
23.86
Negative
23.88
Negative
24.34
Negative
Market Momentum
-0.06
Positive
43.10
Neutral
16.97
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GNTX, the sentiment is Negative. The current price of 23.4 is below the 20-day moving average (MA) of 24.04, below the 50-day MA of 23.86, and below the 200-day MA of 24.34, indicating a bearish trend. The MACD of -0.06 indicates Positive momentum. The RSI at 43.10 is Neutral, neither overbought nor oversold. The STOCH value of 16.97 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GNTX.
Gentex Risk Analysis
Gentex disclosed 24 risk factors in its most recent earnings report. Gentex reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Gentex Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $5.04B | 13.45 | 15.30% | 2.05% | 2.99% | -9.80% | |
72 Outperform | $6.66B | 16.10 | 9.21% | 2.63% | -1.90% | -13.86% | |
72 Outperform | $2.57B | 13.14 | 14.37% | 0.57% | -4.03% | -39.51% | |
71 Outperform | $8.85B | 12.40 | 30.32% | 2.60% | 0.84% | 26.17% | |
65 Neutral | $3.60B | 17.75 | 14.74% | ― | 7.94% | 34.84% | |
62 Neutral | $11.92B | 44.98 | 5.05% | 1.24% | 0.08% | -83.69% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% |
* Consumer Cyclical Sector Average
GNTX
Gentex
23.40
-0.30
-1.27%
ALV
Autoliv
118.52
25.69
27.67%
BWA
BorgWarner
57.57
29.06
101.93%
DORM
Dorman Products
117.86
-13.34
-10.17%
LEA
Lear
131.25
42.59
48.04%
VC
Visteon
95.67
11.96
14.29%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.