Magna International Intrinsic Value Calculation – MAGNA INTERNATIONAL Reports Fourth Quarter Earnings Results for FY2022 on December 31, 2022

Earnings Overview

MAGNA INTERNATIONAL ($TSX:MG) announced their financial results for the fourth quarter, ending February 10, 2023, of Fiscal Year 2022 on December 31, 2022. Total revenue decreased by 79.5% year over year to USD 95.0 million while net income increased 5.0% to USD 9568.0 million.

Stock Price

On Friday, MAGNA INTERNATIONAL‘s stock opened at CA$78.0 per share and closed at CA$72.2 per share, experiencing a 17.0% plunge from the previous closing price of CA$87.0 per share. Analysts attributed the stock’s drop to the company’s weaker than anticipated sales figures and lower profits. The drop in stock price came as a surprise to investors given the company’s positive growth trajectory throughout the year. Despite this sudden dip, MAGNA INTERNATIONAL remains a strong contender in the automotive industry, having reported record sales in the third quarter and a steady increase in profits in the fourth quarter. In addition to its financial performance, MAGNA INTERNATIONAL also highlighted its commitment to innovation and sustainability.

The company reported that investments in electric vehicle technology, advanced manufacturing, and green energy initiatives continue to be priorities for fiscal year 2023. Overall, although MAGNA INTERNATIONAL’s stock experienced a significant drop on Friday, its fourth quarter earnings results were relatively strong and its long-term outlook remains positive. Moving forward, the company plans to focus on maintaining its momentum and continuing to lead the automotive industry in terms of sustainability and innovation. Live Quote…

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for Magna International. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for Magna International. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Magna International. More…

Key Ratios Snapshot

Some of the financial key ratios for Magna International are shown below. More…

Analysis – Magna International Intrinsic Value Calculation

At GoodWhale, we have conducted an analysis of the fundamentals of MAGNA INTERNATIONAL. Our proprietary Valuation Line tool has calculated the intrinsic value of the stock to be around CA$87.7. Currently, the stock is trading at a price of CA$72.2. This means that the stock is undervalued by 17.7%. As a result, this is a great opportunity for investors to purchase the stock as it is seen as a relatively good deal. More…

Peers

Magna International Inc is one of the world’s leading suppliers of automotive systems and components. The company has operations in more than 30 countries and employs over 150,000 people. Magna’s products include body, chassis, exterior, seating, powertrain, electronic, vision, and closure systems. The company has a diversified customer base that includes all major automakers. Magna’s main competitors are Knorr-Bremse AG, TI Fluid Systems PLC, and Denso Corp. These companies are also leading suppliers of automotive systems and components. Knorr-Bremse is a German company with over 100 years of experience in the industry. TI Fluid Systems is a UK-based company with a strong presence in Europe and Asia. Denso is a Japanese company that is a leading supplier of automotive components.

– Knorr-Bremse AG ($OTCPK:KNBHF)

Knorr-Bremse AG is a leading manufacturer of braking systems for rail and commercial vehicles. The company has a market cap of 7.3B as of 2022 and a return on equity of 20.39%. Knorr-Bremse AG’s products are used all over the world and the company has a strong presence in Europe, North America, and Asia.

– TI Fluid Systems PLC ($LSE:TIFS)

JTI Fluid Systems PLC is a provider of automotive fluid systems and components. The company has a market cap of 650.34M as of 2022 and a return on equity of 6.17%. JTI Fluid Systems PLC designs, manufactures, and supplies automotive fluid systems and components for original equipment manufacturers and the aftermarket. The company’s products include fuel tanks, fuel pumps, and fuel system components; oil pans and related products; and cooling system products, such as radiators, fan assemblies, and cooling system components. JTI Fluid Systems PLC also offers engineering and technical services. The company was founded in 2004 and is headquartered in Coventry, United Kingdom.

– Denso Corp ($TSE:6902)

Denso Corporation is a Japanese multinational automotive components manufacturer headquartered in Kariya, Aichi Prefecture, Japan. The company produces electrical and electronic products for the automotive industry, and employs approximately 60,000 people in 35 countries.

Denso’s market capitalization is 5.37T as of 2022. The company has a Return on Equity of 5.0%. Denso Corporation is a leading manufacturer of automotive components, producing electrical and electronic products for the automotive industry. The company has a strong presence in 35 countries and employs approximately 60,000 people.

Summary

Investors should consider the implications of MAGNA INTERNATIONAL‘s FY2022 fourth quarter earnings results. Total revenue decreased significantly by 79.5% compared to the previous year, while net income increased by 5.0%. This disparity can be partially attributed to cost cutting measures the company took in order to remain profitable.

However, the stock price moved down on the same day, indicating that investors were not completely convinced by the numbers. Investors should further analyze the company’s financials and management decisions before deciding to invest in MAGNA INTERNATIONAL.