Gentex (GNTX) AI Stock Analysis

• Market Cap: $4.98B
• Dividend Yield: 2.11%
• Average Volume (3M): 3.29M
• Price to Earnings (P/E): 13.5
• Beta (1Y): 0.60
• Revenue Growth: 2.99%
• EPS Growth: -9.80%
• Country: US
• Employees: 6,184
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Parts
• EPS (TTM): 0.46
• Shares Outstanding: 218,942,920
• 10 Day Avg. Volume: 2,384,805
• 30 Day Avg. Volume: 3,287,965
• PEG Ratio: -4.21
• Price to Book (P/B): 2.63
• Price to Sales (P/S): 2.80
• P/FCF Ratio: 18.34
• Enterprise Value/Market Cap: 1.19
• Enterprise Value/Revenue: 2.44
• Enterprise Value/Gross Profit: 7.26
• Enterprise Value/Ebitda: 11.07
• 1Y Price Target: $29.20
• Price Target Upside: 28.41% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5
• EPS Forecast (FY): 1.78
• Revenue Forecast (FY): $2.54B

• Rating: 70 Outperform
• Price Target: $24.50 ▲(7.74% Upside)

Gentex's overall stock score reflects strong financial performance and fair valuation, which are offset by technical weakness and mixed earnings call results. The company's robust balance sheet and cash flow provide stability, but international market challenges and current bearish technical indicators weigh on the score.

Positive Factors

Strategic Acquisition

The acquisition of VOXX International enhances Gentex's product portfolio and market reach, potentially increasing annual revenue by $325-$375 million and strengthening its position in both automotive and consumer electronics markets.

Cash Flow Generation

Strong cash flow generation provides a solid foundation for future investments and shareholder returns, showcasing effective cash management and ensuring financial stability.

Product Innovation

The introduction of advanced technologies like full display mirrors and driver monitoring systems positions Gentex for significant growth and strengthens its competitive edge in the automotive technology market.

Negative Factors

Decline in Sales

A decline in net sales reflects challenges in sales performance, which could impact revenue growth and profitability if not addressed through strategic initiatives.

Impact of Tariffs

Tariff impacts on the China market have led to production halts, reducing expected revenue and highlighting vulnerability to geopolitical risks, which could affect long-term market strategy.

Increased Operating Expenses

Rising operating expenses, driven by severance and merger costs, strain profitability and may require cost management strategies to maintain financial health.

Gentex Business Overview & Revenue Model

Company Description

Gentex 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 Money

Gentex 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 Financial Statement Overview

Summary

Gentex is financially robust with strong profitability and cash flow generation. The absence of debt enhances its financial stability, although potential growth through leverage is not utilized. Revenue and profit margins are healthy, though some fluctuations in growth rates suggest areas for strategic focus. Overall, Gentex is well-positioned in the vehicles industry, with a solid financial foundation.

Income Statement

Gentex shows a strong gross profit margin averaging around 33% over recent years, indicating effective cost management. The net profit margin has remained stable, suggesting consistent profitability. Revenue growth has been positive, though slightly fluctuating, with a notable increase in 2023. EBIT and EBITDA margins are healthy, reflecting good operational efficiency.

Balance Sheet

The company's balance sheet reflects strong equity levels with no reported debt, indicating a conservative financial structure. However, the absence of liabilities data for 2024 limits a comprehensive analysis. The equity ratio remains robust, suggesting financial stability, yet the lack of debt could also imply missed opportunities for leveraging growth.

Cash Flow

Gentex demonstrates strong cash flow generation, with significant free cash flow growth in recent years. The operating cash flow to net income ratio indicates efficient cash conversion. Free cash flow has consistently exceeded net income, showcasing effective cash management and providing a solid foundation for future investments or shareholder returns.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.43B	2.31B	2.30B	1.92B	1.73B	1.69B
Gross Profit	818.42M	771.09M	762.63M	609.81M	619.71M	605.44M
EBITDA	537.09M	563.31M	589.05M	466.57M	508.89M	504.30M
Net Income	379.55M	404.49M	428.40M	318.76M	360.80M	347.56M
Balance Sheet
Total Assets	2.94B	2.76B	2.68B	2.39B	2.13B	2.22B
Cash, Cash Equivalents and Short-Term Investments	183.40M	255.62M	240.79M	241.76M	267.74M	450.54M
Total Debt	13.03M	4.68M	0.00	0.00	0.00	0.00
Total Liabilities	441.22M	288.72M	365.67M	323.58M	193.40M	260.28M
Stockholders Equity	2.50B	2.47B	2.31B	2.07B	1.94B	1.96B
Cash Flow
Free Cash Flow	470.90M	353.54M	353.57M	191.77M	293.33M	412.79M
Operating Cash Flow	616.02M	498.21M	537.25M	338.20M	362.17M	464.49M
Investing Cash Flow	-272.48M	-202.08M	-299.42M	-172.74M	-113.11M	26.42M
Financing Cash Flow	-341.79M	-289.25M	-230.15M	-209.02M	-410.12M	-363.86M

Gentex Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 22.74
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 22.74 is below the 20-day moving average (MA) of 22.97, below the 50-day MA of 25.32, and below the 200-day MA of 24.16, indicating a bearish trend. The MACD of -0.81 indicates Negative momentum. The RSI at 39.53 is Neutral, neither overbought nor oversold. The STOCH value of 39.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GNTX.

Gentex Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DORM	75 Outperform	$4.14B	16.86	18.19%	―	7.94%	34.84%
LEA	75 Outperform	$5.59B	13.19	8.96%	2.96%	-1.90%	-13.86%
ALV	74 Outperform	$8.92B	12.12	31.09%	2.64%	0.84%	26.17%
BWA	72 Outperform	$9.33B	69.86	2.24%	1.10%	0.08%	-83.69%
VC	71 Outperform	$2.81B	9.26	23.16%	0.53%	-4.03%	-39.51%
GNTX	70 Outperform	$4.98B	13.45	15.23%	2.11%	2.99%	-9.80%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Gentex Corporate Events

Gentex Corp’s Earnings Call: Growth Amid Challenges

The recent earnings call for Gentex Corp painted a mixed picture for the company, highlighting both achievements and challenges. While there was notable growth in overall sales and improvements in gross margins, these positive aspects were counterbalanced by declines in core Gentex revenue and significant revenue drops in Europe and China. The company also faced a decrease in income from operations and net income, with international market challenges and tariffs posing significant concerns.