Canada's Magna Q4 sales beat due to higher production on certain programs

Overview

• Canada auto parts supplier's Q4 sales rose 2% to $10.8 bln, beating analyst expectations

• Adjusted EPS for Q4 increased 29% to $2.18, surpassing analyst estimates

• Company plans to repurchase remaining shares under current buyback authorization

Outlook

• Magna expects 2026 sales between $41.9 bln and $43.5 bln

• Company anticipates 2026 adjusted diluted EPS of $6.25 to $7.25

• Magna plans to repurchase remaining ∼22 million shares under buyback authorization

Result Drivers

• SALES INCREASE - Sales rose 2% to $10.8 bln, driven by higher production on ongoing programs, new program launches, and favorable currency exchange rates

• ADJUSTED EBIT GROWTH - Adjusted EBIT increased 18% to $814 mln due to productivity improvements, customer recoveries for tariffs, and higher vehicle assembly volumes

• IMPAIRMENT CHARGE - Income from operations before taxes declined to $114 mln due to a $591 mln impairment charge in the Electronics reporting unit

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 3 "strong buy" or "buy", 7 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the auto, truck & motorcycle parts peer group is "buy."

• The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 8 three months ago

Press Release: ID:nGNE4SLYg6

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