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Stoneridge (SRI)
NYSE:SRI
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Stoneridge
(NYSE:SRI)
50Neutral
Positive Factors
Financial Performance
SRI outperformed its weighted average OEM end markets by 490 bps with an adjusted sales decline of 5.5% versus an end market decline of 10.4%.
Product Innovation
MirrorEye will become a 'must-have product' for Class 8 trucks as it dramatically improves driver visibility and safety, while also generating efficiencies in fuel savings.
Product Revenue
Full-year 2024 MirrorEye related revenue increased 22% to $66 million representing outperformance of weighted average end markets that declined by 24.2%.
Negative Factors
Market Challenges
The Control Devices segment will be a drag on growth due to the current state of the automotive OEM market, especially EV rollouts.
Market Environment
The Control Devices segment is operating in a challenged market environment due to sluggish new vehicle OEM production and slower-than-expected ramp-up of EV platforms.
Operational Costs
Q4/24 was impacted by one-time quality-related items and incremental engineering costs that negatively affected adjusted EBITDA by $3.1 million and $2.1 million, respectively.
Stoneridge (SRI) vs. S&P 500 (SPY)
Market Cap
$127.12M
Dividend YieldN/A
Average Volume (3M)453.47K
Price to Earnings (P/E)―
Beta (1Y)1.32
Revenue Growth-6.92%
EPS Growth-215.11%
CountryUS
Employees4,450
SectorConsumer Cyclical
Sector Strength54
IndustryAuto - Parts
Share Statistics
EPS (TTM)-0.60
Shares Outstanding27,695,248
10 Day Avg. Volume242,038
30 Day Avg. Volume453,473
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.15
Price to Cash Flow (P/CF)1.80
P/FCF Ratio2.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$16.00Price Target Upside234.03% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Stoneridge Business Overview & Revenue Model
Company DescriptionStoneridge, Inc. (SRI) is a global designer and manufacturer of highly engineered electrical and electronic components, modules, and systems for the automotive, commercial, off-highway, and agricultural vehicle markets. The company's product portfolio includes sensor and actuator technology, vision systems, connectivity solutions, and electronic control units, which are integral to vehicle performance and safety.
How the Company Makes MoneyStoneridge makes money by designing and manufacturing a wide range of electrical and electronic components and systems that are critical to the automotive and commercial vehicle industries. The company generates revenue through the sale of its products to original equipment manufacturers (OEMs) and aftermarket distributors. Key revenue streams include the production of sensors and actuators that enhance vehicle efficiency and safety, vision systems that provide advanced driver assistance, and connectivity solutions that support vehicle communication and data management. Stoneridge's earnings are also impacted by its strategic partnerships with vehicle manufacturers and suppliers, which help to drive innovation and expand its market reach.
Stoneridge Financial Statement Overview
Summary
Stoneridge shows a mixed financial profile with improved cash flow but ongoing profitability challenges. Revenue has fluctuated, and operational margins are under pressure, leading to consistent net losses. The balance sheet has a favorable equity ratio, but the company's ability to sustain operations and growth is hindered by profitability issues.Income Statement
Stoneridge has shown fluctuating revenue trends with a decline from $975.8M in 2023 to $908.3M in 2024. Gross Profit Margin is high due to a reported gross profit equal to total revenue for 2024, suggesting possible data inconsistency. EBIT and EBITDA margins are negative, indicating operational challenges. Net Profit Margin has remained negative, reflecting struggles in achieving profitability.45
Neutral
Balance Sheet
The debt-to-equity ratio has improved significantly from 2023 to 2024, driven by a reduction in total debt. Return on Equity remains negative, reflecting ongoing net losses. The equity ratio is strong, indicating a stable asset base relative to liabilities, but overall financial health is affected by persistent losses.55
Neutral
Cash Flow
Free Cash Flow turned positive in 2024 after being negative in previous years, indicating improved cash generation. The Operating Cash Flow to Net Income ratio is favorable, suggesting effective cash management. However, the Free Cash Flow to Net Income ratio is skewed due to negative net income figures, which complicates profitability assessment based on cash flow.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 908.29M | 975.82M | 899.92M | 770.46M | 648.01M | Gross Profit |
| 189.25M | 202.10M | 174.93M | 166.86M | 154.20M | EBIT |
| -381.00K | 12.84M | -3.60M | -13.09M | -4.60M | EBITDA |
| -381.00K | 45.06M | 30.25M | 50.18M | 27.68M | Net Income Common Stockholders |
| -16.52M | -5.18M | -14.06M | 3.41M | -7.95M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 71.83M | 40.84M | 54.80M | 85.55M | 73.92M | Total Assets |
| 621.56M | 679.90M | 652.11M | 665.40M | 621.41M | Total Debt |
| 6.48M | 203.01M | 179.85M | 184.12M | 159.11M | Net Debt |
| -65.35M | 162.17M | 125.05M | 98.57M | 85.19M | Total Liabilities |
| 376.30M | 392.18M | 371.16M | 369.45M | 324.77M | Stockholders Equity |
| 245.26M | 287.72M | 280.94M | 295.95M | 296.63M |
| Cash Flow | Free Cash Flow | |||
| 47.75M | -33.55M | -24.80M | -63.28M | -3.82M | Operating Cash Flow |
| 47.75M | 4.95M | 6.81M | -36.25M | 28.64M | Investing Cash Flow |
| -24.47M | -36.98M | -28.58M | 28.04M | -33.88M | Financing Cash Flow |
| 11.12M | 17.48M | -7.30M | 22.88M | 6.51M |
Stoneridge Technical Analysis
Negative
4.79
Price Trends
4.94
Negative
5.67
Negative
9.44
Negative
Market Momentum
-0.06
Positive
43.22
Neutral
15.24
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SRI, the sentiment is Negative. The current price of 4.79 is below the 20-day moving average (MA) of 5.11, below the 50-day MA of 4.94, and below the 200-day MA of 9.44, indicating a bearish trend. The MACD of -0.06 indicates Positive momentum. The RSI at 43.22 is Neutral, neither overbought nor oversold. The STOCH value of 15.24 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SRI.
Stoneridge Risk Analysis
Stoneridge disclosed 28 risk factors in its most recent earnings report. Stoneridge reported the most risks in the “Ability to Sell” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Stoneridge Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $503.37M | 3.39 | 10.41% | 8.79% | -11.02% | -51.66% | |
66 Neutral | $6.87B | 11.01 | 26.69% | 3.10% | -0.80% | 39.95% | |
64 Neutral | $4.73B | 9.83 | 10.81% | 3.52% | -0.70% | -7.27% | |
62 Neutral | $6.29B | 19.05 | 6.46% | 1.53% | -11.10% | -46.32% | |
59 Neutral | $12.17B | 11.04 | -1.10% | 3.77% | 1.26% | -19.70% | |
54 Neutral | $1.94B | ― | -3.92% | 3.02% | -2.57% | -248.28% | |
50 Neutral | $127.12M | ― | -6.20% | ― | -6.92% | -215.11% |
* Consumer Cyclical Sector Average
Performance Comparison
SRI
Stoneridge
4.79
-12.79
-72.75%
ALV
Autoliv
90.34
-25.06
-21.72%
BWA
BorgWarner
29.12
-5.22
-15.20%
DAN
Dana Holding
13.68
1.66
13.81%
LEA
Lear
88.76
-50.29
-36.17%
TEN
Tsakos Energy Navigation
17.15
-8.03
-31.89%
Stoneridge Earnings Call Summary
Earnings Call Date: Feb 26, 2025 | % Change Since: 14.05% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a balanced outlook with significant achievements in product growth and cost management, offset by challenges in specific segments and unexpected quality and engineering costs.Highlights
Outperformance in Challenging Markets
Stoneridge outperformed its weighted average end markets by 490 basis points, despite a 10.4% decline in OEM end markets.
Growth of Key Products
MirrorEye revenue increased by 22% year over year, and Smart 2 Tachograph sales almost doubled relative to 2023, resulting in $60 million in revenue.
Cash Flow Improvement
Positive free cash flow of approximately $24 million was achieved, an increase of $56 million versus the prior year, driven by a $36 million inventory reduction.
Material and Labor Cost Reduction
Material costs were reduced by 120 basis points, and direct labor costs improved by 30 basis points, effectively a 7% improvement year over year.
Future Growth Projections
Stoneridge projects significant revenue growth for MirrorEye, expecting to reach $120 million in 2025 and further aiming for $300 million annually by 2029.
Lowlights
Decline in Adjusted EBITDA Margin
Full year adjusted EBITDA margin declined by approximately 80 basis points compared to the prior year.
Challenges in Control Devices Segment
Control Devices full year sales declined by approximately 14% due to lower production volumes for a major North American passenger vehicle customer.
Quality and Warranty Costs
Elevated warranty and other quality-related costs significantly impacted financial performance, including a $3.1 million net impact in the fourth quarter.
Engineering and Quality Cost Surprises
Fourth quarter engineering expenses were $2.1 million higher than expected, due to design-related tooling changes and delayed customer reimbursements.
Company Guidance
In the Stoneridge, Inc. Fourth Quarter 2024 Results Conference Call, the company provided guidance that indicated a strategic focus on growth and operational efficiency. Stoneridge expects 2025 revenue to be in the range of $860 million to $890 million, driven by strong growth in its MirrorEye product, anticipated to generate approximately $120 million, a 75% increase from 2024. The company aims to improve its gross margin by 135 basis points to a midpoint of 22.25%, and expects operating income to rise by 70 basis points to a midpoint of 1%, with an EBITDA margin projected at approximately 4.6%. Stoneridge also targets free cash flow of $25 million to $30 million in 2025, supported by continued inventory and working capital improvements. Looking further ahead to 2026, the company forecasts revenue of at least $975 million, reflecting an 11% growth, and an EBITDA of at least $70 million, signaling a continued emphasis on expanding market share and enhancing shareholder value through operational improvements and strategic product launches.Stoneridge Corporate Events
Business Operations and StrategyFinancial Disclosures
Stoneridge Reports Q4 Loss, Sets Ambitious 2025 Targets
Neutral
Feb 26, 2025
Stoneridge, Inc. reported its financial results for the fourth quarter and full year ending December 31, 2024. The company experienced a net cash improvement of approximately $43 million year-over-year, primarily driven by a $36 million reduction in inventory. Despite a net loss of $6.1 million in the fourth quarter, Stoneridge set ambitious revenue and EBITDA targets for 2025 and 2026, with expectations of significant contributions from its MirrorEye technology. The company also focused on cost reductions and operational efficiency improvements, achieving a 7% year-over-year improvement in material and labor costs. Challenges included lower sales in certain markets and higher quality-related costs, but strategic initiatives are in place to address these issues moving forward.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.