For those who appreciate value investing, NYSE:LEA is a compelling option with its solid fundamentals.

Last update: Oct 26, 2023

Discover LEAR CORP (NYSE:LEA), an undervalued stock highlighted by our stock screener. NYSE:LEA showcases solid financial health and profitability while maintaining an appealing valuation. We'll explore the details.

Unpacking NYSE:LEA's Valuation Rating

ChartMill assigns a Valuation Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing different valuation elements, such as price to earnings and free cash flow, both in absolute terms and relative to the market and industry. In the case of NYSE:LEA, the assigned 8 reflects its valuation:

A Price/Earnings ratio of 11.53 indicates a reasonable valuation of LEA.
Based on the Price/Earnings ratio, LEA is valued cheaper than 80.95% of the companies in the same industry.
LEA's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 24.74.
The Price/Forward Earnings ratio is 8.07, which indicates a very decent valuation of LEA.
Based on the Price/Forward Earnings ratio, LEA is valued cheaply inside the industry as 85.71% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of LEA to the average of the S&P500 Index (18.34), we can say LEA is valued rather cheaply.
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of LEA indicates a somewhat cheap valuation: LEA is cheaper than 76.19% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, LEA is valued a bit cheaper than the industry average as 64.29% of the companies are valued more expensively.
LEA's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as LEA's earnings are expected to grow with 32.91% in the coming years.

Profitability Examination for NYSE:LEA

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:LEA, the assigned 5 is noteworthy for profitability:

LEA has a better Return On Assets (3.53%) than 66.67% of its industry peers.
LEA's Return On Equity of 10.48% is fine compared to the rest of the industry. LEA outperforms 73.81% of its industry peers.
LEA's Return On Invested Capital of 8.48% is fine compared to the rest of the industry. LEA outperforms 66.67% of its industry peers.
The last Return On Invested Capital (8.48%) for LEA is above the 3 year average (6.79%), which is a sign of increasing profitability.
LEA has a Profit Margin of 2.32%. This is in the better half of the industry: LEA outperforms 61.90% of its industry peers.

A Closer Look at Health for NYSE:LEA

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NYSE:LEA, the assigned 5 reflects its health status:

With a decent Debt to FCF ratio value of 6.16, LEA is doing good in the industry, outperforming 61.90% of the companies in the same industry.

A Closer Look at Growth for NYSE:LEA

ChartMill assigns a Growth Rating to each stock, ranging from 0 to 10. This rating is determined by analyzing different growth elements, including EPS and revenue growth, spanning both historical and future figures. In the case of NYSE:LEA, the assigned 6 reflects its growth potential:

LEA shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 110.67%, which is quite impressive.
Looking at the last year, LEA shows a quite strong growth in Revenue. The Revenue has grown by 15.59% in the last year.
LEA is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 25.64% yearly.
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

Check the latest full fundamental report of LEA for a complete fundamental analysis.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.