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Nexteer Automotive Group Limited (HK:1316)
:1316
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Nexteer Automotive Group
(1316)
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Rating:69Neutral
Price Target:
HK$6.50
▲(7.79% Upside)
Nexteer Automotive Group's overall stock score is driven by strong financial performance and a positive earnings call, highlighting record revenue and strategic expansions. However, technical analysis indicates a bearish trend, and valuation metrics suggest the stock is fairly valued. Despite some challenges, the company's outlook remains optimistic, particularly with growth in the APAC region.
Positive Factors
Revenue Growth
The company's record revenue growth indicates strong market demand and effective sales strategies, particularly in the APAC region, which enhances its market position and future revenue potential.
Technological Advancements
Investments in advanced technologies position Nexteer as a leader in automotive innovation, supporting long-term competitiveness and potential for new revenue streams in emerging vehicle technologies.
Strategic Expansion
Strategic expansions in the APAC region enhance production capabilities and local market access, supporting growth and operational efficiency in a key automotive market.
Negative Factors
Supplier Challenges
Supplier issues in North America could disrupt operations and increase costs, potentially affecting profitability and supply chain reliability over the medium term.
Tariff Costs
Tariff-related costs pose a risk to financial performance, requiring effective mitigation strategies to maintain margins and competitiveness in affected markets.
Booking Slowdown
A slowdown in new bookings, especially in North America, could signal future revenue challenges and indicate a need to adapt sales strategies to changing market conditions.
Nexteer Automotive Group (1316) vs. iShares MSCI Hong Kong ETF (EWH)
Market Cap
$15.36B
Dividend Yield1.14%
Average Volume (3M)9.03M
Price to Earnings (P/E)18.0
Beta (1Y)1.73
Revenue Growth4.73%
EPS Growth492.16%
CountryHK
Employees12,600
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Parts
Share Statistics
EPS (TTM)N/A
Shares Outstanding2,509,824,200
10 Day Avg. Volume7,973,400
30 Day Avg. Volume9,034,957
Financial Highlights & Ratios
PEG Ratio0.12
Price to Book (P/B)0.54
Price to Sales (P/S)0.25
P/FCF Ratio6.50
Enterprise Value/Market Cap0.00
Enterprise Value/Revenue0.00
Enterprise Value/Gross Profit0.00
Enterprise Value/Ebitda0.00
Forecast
1Y Price Target
$9.26Price Target Upside53.56% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Nexteer Automotive Group Business Overview & Revenue Model
Company DescriptionNexteer Automotive Group Limited, an investment holding company, designs, develops, manufactures, and distributes steering and driveline systems and components for automobile manufacturers and other automotive-related companies. It offers electric power steering (EPS) products, such as column, pinion, and rack assist, as well as dual pinion EPS; EPS remanufacturing products, intermediate shafts, and modular power packs; and hydraulic power steering products, such as magnetic torque overlay, smart flow pumps, power steering pumps and reservoirs, rack and pinion steering gears, and recirculating ball steering gears, as well as aftermarket products. The company also provides steering columns, including power tilts and telescopes, power rakes and telescopes, one-touch adjustable columns, manual rakes and telescopes, non-adjustable columns, intermediate shafts, transmission shifters, and stowable steering column, as well as electronics, modules, and sub-assemblies. In addition, it offers driveline products comprising front and rear wheel half shafts, intermediate drive shafts, and propeller shaft constant velocity joints. Further, the company provides advanced driver assistance systems and automated driving technologies, which include steer by wire, steering on demand system, quiet wheel steering, magnetic torque overlay, and high availability EPS for resilient operational availability, as well as offers customer support and engineering center services. It operates in North America, the Asia Pacific, Europe, the Middle East, Africa, and South America. The company was founded in 1906 and is headquartered in Auburn Hills, Michigan. Nexteer Automotive Group Limited is a subsidiary of Nexteer Automotive (Hong Kong) Holdings Limited.
How the Company Makes MoneyNexteer Automotive Group generates revenue primarily through the sale of its steering and driveline systems to automotive manufacturers worldwide. The company has established key partnerships with major automakers, which are critical for securing long-term contracts and ongoing projects. Nexteer's revenue model is predominantly based on direct sales of its products, including electric power steering systems, traditional steering solutions, and driveline components. Additionally, the company invests in research and development to create advanced technologies, which can lead to new product offerings and revenue streams. Factors contributing to its earnings include the increasing demand for electric vehicles, advancements in autonomous driving technologies, and a focus on improving vehicle safety and efficiency.
Nexteer Automotive Group Earnings Call Summary
Earnings Call Date:Aug 13, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Mar 18, 2026
Earnings Call Sentiment Positive
The earnings call reflects a strong overall performance with record revenue and significant growth in both EBITDA and net profit. Key technological advancements and strategic expansions in the APAC region highlight the company's strategic direction. However, the call also addressed some challenges, including supplier issues and tariff impacts in North America, and a notable slowdown in bookings. Despite these challenges, the company maintains a positive outlook for the second half of the year.Q2-2025 Updates
Positive Updates
Record-Breaking First Half Revenue
Nexteer achieved a record first-half 2025 revenue of $2.2 billion, increasing by 6.8% compared to the prior year.
EBITDA and Profit Growth
EBITDA grew by 16.8% year-over-year, with margins expanding by 90 basis points. Net profit increased fourfold, with a margin improvement of 210 basis points.
Significant New Business Bookings
Secured $1.5 billion in new business bookings, with key wins in North America, APAC, and Europe.
Technological Advancements
Expanded Motion-by-Wire chassis control technologies, including Steer-by-Wire, Rear Wheel Steering, and Electro-Mechanical Braking.
Expansion in APAC Region
Opened a new state-of-the-art facility in Changshu and broke ground on a new smart manufacturing facility in Liuzhou.
Negative Updates
Supplier Challenges in North America
North America faced issues with troubled suppliers, resulting in a $7 million cost impact.
Tariff Costs
Net tariff costs impacted earnings by $2 million in the first half, with ongoing efforts to mitigate these costs.
Booking Slowdown in North America
A 30% year-over-year decline in booking wins, particularly in North America, due to less customer rollout opportunities.
Company Guidance
During the Nexteer Automotive Group Limited 2025 Interim Results Conference Call, several key metrics and guidance highlights were discussed. The company launched a record 31 programs in the first half of 2025, with 23 new or conquest awards, including significant achievements like the first Dual Pinion EPS launch with a Chinese OEM and a $1.5 billion value in new business bookings. Revenue reached a record $2.2 billion, marking a 6.8% increase year-over-year, mainly driven by growth in APAC with Chinese OEMs. EBITDA grew by 16.8%, with margins expanding by 90 basis points, while net profit increased fourfold to $63 million, and free cash flow was positive at $37 million. The company remains on track to achieve its $5 billion booking target for the year. Operational efficiency and strategic expansions in China, including new facilities in Changshu and Liuzhou, are emphasized as critical focus areas. Guidance also noted potential impacts of tariffs and restructuring costs, with a plan to mitigate tariff costs aiming for a net neutral impact by year-end. The company is optimistic about future growth driven by continued technology leadership and strategic market positioning, particularly in China.Nexteer Automotive Group Financial Statement Overview
Summary
Nexteer Automotive Group shows positive financial health with steady revenue growth and improved profitability. The balance sheet is strong with low leverage and substantial equity. Cash flow performance is robust, underscoring effective cash management. Nevertheless, there is potential for enhancing operational margins to further strengthen financial performance.Income Statement
The company has shown consistent revenue growth with a 1.65% increase in 2024 from 2023. Gross profit margins have improved to 11.26%, reflecting better cost management. Net profit margin rose to 1.44%, indicating a slight improvement in profitability. However, EBIT and EBITDA margins are relatively low at 2.68% and 7.06%, respectively, suggesting room for operational efficiency improvements.75
Positive
Balance Sheet
The debt-to-equity ratio is low at 0.05, indicating minimal leverage and a strong equity base. Return on equity stands at 3.12%, showing moderate profitability. The equity ratio is 56.87%, signifying a solid financial structure with more than half of the assets financed by equity.80
Positive
Cash Flow
There is a robust free cash flow growth of 79.37% from 2023 to 2024. The operating cash flow to net income ratio is strong at 7.23, indicating efficient cash conversion. The free cash flow to net income ratio is 2.67, reflecting healthy cash flow generation relative to net income.78
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.42B | 4.28B | 4.21B | 3.84B | 3.36B | 3.03B |
| Gross Profit | 529.40M | 481.42M | 368.59M | 367.15M | 363.43M | 407.94M |
| EBITDA | 358.10M | 302.05M | 357.48M | 362.74M | 370.10M | 348.89M |
| Net Income | 109.50M | 61.72M | 36.74M | 58.01M | 118.44M | 116.77M |
Balance Sheet | ||||||
| Total Assets | 3.62B | 3.48B | 3.40B | 3.34B | 3.21B | 3.31B |
| Cash, Cash Equivalents and Short-Term Investments | 459.22M | 422.28M | 311.74M | 245.93M | 326.52M | 553.42M |
| Total Debt | 92.27M | 91.59M | 100.39M | 110.71M | 146.76M | 305.99M |
| Total Liabilities | 1.51B | 1.45B | 1.39B | 1.36B | 1.20B | 1.38B |
| Stockholders Equity | 2.07B | 1.98B | 1.96B | 1.93B | 1.95B | 1.88B |
Cash Flow | ||||||
| Free Cash Flow | 306.36M | 164.89M | 91.91M | 173.41M | 145.78M | 270.10M |
| Operating Cash Flow | 436.16M | 446.23M | 404.12M | 293.76M | 287.38M | 419.85M |
| Investing Cash Flow | -230.79M | -279.79M | -299.15M | -263.47M | -285.66M | -288.00M |
| Financing Cash Flow | -35.19M | -43.16M | -38.40M | -85.18M | -215.45M | -186.94M |
Nexteer Automotive Group Technical Analysis
Positive
6.03
Price Trends
6.55
Negative
6.75
Negative
6.05
Positive
Market Momentum
-0.13
Negative
47.94
Neutral
35.53
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1316, the sentiment is Positive. The current price of 6.03 is above the 20-day moving average (MA) of 5.98, below the 50-day MA of 6.55, and below the 200-day MA of 6.05, indicating a neutral trend. The MACD of -0.13 indicates Negative momentum. The RSI at 47.94 is Neutral, neither overbought nor oversold. The STOCH value of 35.53 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:1316.
Nexteer Automotive Group Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $35.16B | 12.57 | 12.26% | 1.44% | 11.06% | 22.10% | |
69 Neutral | $15.36B | 18.01 | 5.45% | 1.14% | 4.73% | 492.16% | |
67 Neutral | HK$8.10B | 333.22 | 2.26% | 0.20% | 32.92% | 67.96% | |
65 Neutral | €10.77B | 18.70 | 9.59% | 1.41% | 35.32% | 24.24% | |
64 Neutral | HK$2.22B | 12.77 | 6.62% | 3.09% | 13.35% | -38.32% | |
64 Neutral | HK$25.86B | 12.44 | 9.85% | 2.18% | -3.02% | 11.38% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% |
* Consumer Cyclical Sector Average
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Nexteer Automotive Group Corporate Events
Nexteer Automotive Appoints Hervé Boyer as Executive Director
Nov 13, 2025
Nexteer Automotive Group Limited has announced the appointment of Hervé Paul Gino Boyer as an executive director effective November 12, 2025. Boyer, who has extensive experience in the automotive industry, currently serves as the Senior Vice President, Global Chief Operating Officer, and North America Division President. His appointment is expected to further enhance the company’s operational efficiencies and profitability, potentially impacting its market positioning positively.
Nexteer Automotive Announces Board Composition and Roles
Nov 13, 2025
Nexteer Automotive Group Limited has announced the composition of its board of directors, detailing the roles and functions of each member. The board includes executive, non-executive, and independent non-executive directors, with specific members assigned to the Audit and Compliance Committee and the Remuneration and Nomination Committee. This announcement provides clarity on the governance structure of the company, potentially impacting its strategic direction and stakeholder confidence.
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.