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Valeo SA (EU)
(OTC:VLEEY)
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Rating:62Neutral
Price Target:
$8.00
â–²(2.43% Upside)
Action:Reiterated
Date:07/23/26
The score is driven primarily by improving financials (notably deleveraging and solid cash generation) and a supportive earnings call with reaffirmed guidance, better margins, strong free cash flow and order intake. Offsetting these positives are still-thin net profitability, recent revenue softness, and mixed near-term technical momentum (slightly negative MACD and price below the 50-day average), while valuation and dividend yield provide a moderate cushion.
Positive Factors
Balance sheet de‑risking
Material deleveraging (debt-to-equity ~0.19 in 2025 vs ~1.6–2.0 prior) meaningfully reduces refinancing and liquidity risk. This improves financial flexibility to fund technology investment, absorb cyclical OEM shocks, and support strategic spending over the medium term.
Negative Factors
Thin net profitability
Despite margin recovery, net margin remains very thin (~1% in 2025) and reported net income showed limited improvement. Low bottom‑line profitability constrains retained earnings, limits resilience to cost or volume shocks, and keeps earnings vulnerable in a downturn.
Read all positive and negative factors
Positive Factors
Negative Factors
Balance sheet de‑risking
Material deleveraging (debt-to-equity ~0.19 in 2025 vs ~1.6–2.0 prior) meaningfully reduces refinancing and liquidity risk. This improves financial flexibility to fund technology investment, absorb cyclical OEM shocks, and support strategic spending over the medium term.
Read all positive factors
Valeo SA (EU) (VLEEY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.14B
Dividend Yield3.1%
Average Volume (3M)177.00
Price to Earnings (P/E)17.8
Beta (1Y)1.21
Revenue Growth5.15%
EPS Growth72.37%
CountryUS
Employees100,216
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Parts
Share Statistics
EPS (TTM)0.42
Shares Outstanding491,215,240
10 Day Avg. Volume33
30 Day Avg. Volume177
Financial Highlights & Ratios
PEG Ratio0.91
Price to Book (P/B)0.86
Price to Sales (P/S)0.14
P/FCF Ratio5.43
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)0.82
Revenue Forecast (FY)$23.31B
Valeo SA (EU) Business Overview & Revenue Model
Company Description
Valeo SE, a prominent global supplier established in 1923 and headquartered in Paris, France, specializes in the design, production, and distribution of components, integrated systems, and related services for automotive manufacturers. Its market ...
How the Company Makes Money
Valeo primarily makes money by selling automotive components and integrated systems to original equipment manufacturers (OEMs) under supply contracts tied to vehicle production programs. Revenue is generated across multiple product lines: (1) Elec...
Valeo SA (EU) Earnings Call Summary
Earnings Call Date:Jul 22, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Mar 04, 2027
Earnings Call Sentiment Positive
The call conveyed a predominantly positive operational and financial momentum: profitability and cash generation engines are running, evidenced by higher operating margin (5.0%), strong free cash flow (EUR 242m), net debt reduction and robust order intake (EUR 12.1bn). Division-level improvements, especially the POWER turnaround and high gross margin (20.7%), support the narrative. However, notable risks remain—China sales contraction, high effective tax rate (48%), an R&D impairment (EUR 85m), market volatility and supply/cost pressures—which temper near-term visibility. On balance, the positives (margin gains, cash, deleveraging, large orders and beyond-automotive pipeline) outweigh the negatives.Positive Updates
Group Sales and Top-Line Stability
Group sales of EUR 10.4 billion in H1 '26, up 0.7% like-for-like, largely in line with guidance and with the group's Elevate '28 trajectory.
Negative Updates
China Sales Contraction
Sales in China contracted by 9% like-for-like in H1 '26, underperforming the market by 4 points due to weaker performance with international OEMs despite strong order intake skewed to Chinese OEMs.
Read all updates
Q2-2026 Updates
Positive
Negative
Group Sales and Top-Line Stability
Group sales of EUR 10.4 billion in H1 '26, up 0.7% like-for-like, largely in line with guidance and with the group's Elevate '28 trajectory.
Read all positive updates
Company Guidance
Valeo reaffirmed its full‑year 2026 guidance and said H2 operating margin and free cash flow should be at least in line with H1 (H1 sales €10.4bn; operating margin 5.0%, +50bp YoY; free cash flow after net financial interest €242m, >2x H1’25 and >50% of minimum full‑year guidance). They noted order intake €12.1bn (1.4x H1 OEM sales; POWER and BRAIN each ~>1/3, LIGHT 25%; China orders >80% with Chinese OEMs and a 5x book‑to‑bill), gross margin 20.7%, SG&A down 3% YoY, net R&D at 11% of sales (+2%) with €85m R&D impairment and an expected full‑year IFRS R&D impact <1pp, capitalized R&D -5%, tangible CapEx -12% to 3.6% of sales (aiming to stay below long‑term 4.5–5%), net debt reduced by ~€194m to €3.8bn (≈€350m vs a year ago) with leverage 1.2x adjusted EBITDA, liquidity €3.0bn cash + €1.6bn undrawn, and the group reiterated a return to growth from 2027 (all assuming stable conditions).Valeo SA (EU) Financial Statement Overview
Summary
Income Statement
56
Neutral
Balance Sheet
62
Positive
Cash Flow
58
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 20.83B | 20.90B | 21.49B | 22.04B | 20.04B | 17.26B |
| Gross Profit | 4.32B | 4.23B | 4.08B | 3.95B | 2.58B | 2.29B |
| EBITDA | 3.32B | 2.90B | 2.72B | 2.66B | 2.35B | 2.36B |
| Net Income | 202.38M | 192.11M | 162.00M | 221.00M | 230.00M | 175.00M |
Balance Sheet | ||||||
| Total Assets | 21.23B | 20.27B | 21.66B | 21.76B | 22.03B | 18.84B |
| Cash, Cash Equivalents and Short-Term Investments | 3.10B | 2.48B | 3.15B | 3.14B | 3.41B | 2.42B |
| Total Debt | 6.88B | 6.44B | 7.04B | 6.99B | 7.45B | 5.88B |
| Total Liabilities | 16.87B | 16.20B | 17.14B | 17.40B | 17.42B | 14.34B |
| Stockholders Equity | 3.40B | 3.32B | 3.72B | 3.58B | 3.82B | 3.69B |
Cash Flow | ||||||
| Free Cash Flow | 1.52B | 528.00M | 463.00M | 461.00M | 319.00M | 249.00M |
| Operating Cash Flow | 2.30B | 2.29B | 2.69B | 2.46B | 1.81B | 1.60B |
| Investing Cash Flow | -1.59B | -1.57B | -1.95B | -1.91B | -1.93B | -1.57B |
| Financing Cash Flow | -141.45M | -1.16B | -524.00M | -788.00M | 862.00M | -641.00M |
Valeo SA (EU) Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $8.89B | 14.32 | 25.10% | 2.94% | 5.89% | -7.00% | |
67 Neutral | $6.05B | 11.60 | 10.90% | 2.14% | 3.55% | 25.67% | |
63 Neutral | $2.86B | 19.33 | 9.71% | 1.23% | -1.13% | -47.30% | |
62 Neutral | $4.14B | 17.82 | 5.98% | 3.35% | 5.15% | 72.37% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
61 Neutral | $5.35B | 15.51 | -46.50% | 0.95% | 8.47% | 29.11% | |
55 Neutral | $3.26B | -18.97 | -13.31% | 1.63% | -15.78% | -384.04% |
* Consumer Cyclical Sector Average
VLEEY
Valeo SA (EU)
8.46
2.51
42.14%
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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.