Lear Corporation (NYSE:LEA) Receives Consensus Recommendation of "Hold" from Brokerages

Key Points

• Analyst consensus is “Hold”: Twelve of 16 brokerages rate Lear neutral, while three recommend buying and one gives a strong-buy rating. The average 12-month price target is $146.33, above the stock’s reported $120.39 price.
• Lear exceeded quarterly expectations: The auto-parts company reported adjusted EPS of $4.28 versus the $3.98 consensus and revenue of $6.21 billion versus $6.15 billion expected, with revenue up 3% year over year.
• Shares remain under pressure amid insider selling: Lear traded down 0.2% and below its 50-day and 200-day moving averages, while the CEO and a director recently sold substantial portions of their holdings. Institutional investors own 97.04% of the stock, and the company pays a $0.77 quarterly dividend.

Lear Corporation (NYSE:LEA - Get Free Report) has received a consensus recommendation of "Hold" from the sixteen brokerages that are currently covering the firm, Marketbeat reports. Twelve research analysts have rated the stock with a hold recommendation, three have given a buy recommendation and one has issued a strong buy recommendation on the company. The average 12-month price target among brokers that have issued ratings on the stock in the last year is $146.3333.

A number of research analysts have recently commented on LEA shares. JPMorgan Chase & Co. reaffirmed a "neutral" rating and set a $150.00 price objective (down from $175.00) on shares of Lear in a research report on Tuesday, September 15th. TD Cowen upgraded Lear from a "hold" rating to a "buy" rating and boosted their price target for the company from $138.00 to $165.00 in a research note on Tuesday, May 26th. Wells Fargo & Company upped their price target on Lear from $137.00 to $138.00 and gave the company an "equal weight" rating in a report on Monday, August 3rd. Barclays lifted their price objective on Lear from $150.00 to $155.00 and gave the stock an "equal weight" rating in a report on Thursday, July 9th. Finally, Deutsche Bank Aktiengesellschaft set a $131.00 target price on Lear in a research note on Monday, August 3rd.

Insider Activity

In other news, CEO Raymond Scott sold 50,000 shares of Lear stock in a transaction dated Wednesday, June 24th. The shares were sold at an average price of $135.37, for a total transaction of $6,768,500.00. Following the sale, the chief executive officer directly owned 49,789 shares in the company, valued at approximately $6,739,936.93. The trade was a 50.11% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, Director Conrad L. Mallett, Jr. sold 1,646 shares of the stock in a transaction dated Thursday, August 6th. The stock was sold at an average price of $121.35, for a total transaction of $199,742.10. Following the completion of the transaction, the director directly owned 37 shares of the company's stock, valued at $4,489.95. This trade represents a 97.80% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. 1.02% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Lear

Several large investors have recently made changes to their positions in the company. Sequoia Financial Advisors LLC lifted its holdings in Lear by 3.8% during the 2nd quarter. Sequoia Financial Advisors LLC now owns 10,021 shares of the auto parts company's stock valued at $1,343,000 after purchasing an additional 363 shares during the last quarter. Tidal Investments LLC boosted its position in Lear by 48.7% in the second quarter. Tidal Investments LLC now owns 22,783 shares of the auto parts company's stock valued at $3,054,000 after buying an additional 7,461 shares in the last quarter. WINTON GROUP Ltd bought a new stake in Lear during the second quarter worth about $214,000. Engineers Gate Manager LP increased its holdings in shares of Lear by 145.6% during the second quarter. Engineers Gate Manager LP now owns 126,588 shares of the auto parts company's stock worth $16,970,000 after buying an additional 75,043 shares in the last quarter. Finally, Integrated Wealth Concepts LLC raised its stake in shares of Lear by 16.6% in the second quarter. Integrated Wealth Concepts LLC now owns 3,396 shares of the auto parts company's stock valued at $455,000 after acquiring an additional 484 shares during the last quarter. Institutional investors own 97.04% of the company's stock.

Lear Trading Down 0.2%

Shares of Lear stock opened at $120.39 on Tuesday. The company's fifty day simple moving average is $130.05 and its 200-day simple moving average is $130.31. The company has a market cap of $5.94 billion, a price-to-earnings ratio of 11.22, a PEG ratio of 0.74 and a beta of 1.26. The company has a current ratio of 1.31, a quick ratio of 1.04 and a debt-to-equity ratio of 0.51. Lear has a 1 year low of $96.04 and a 1 year high of $150.33.

Lear (NYSE:LEA - Get Free Report) last released its earnings results on Friday, July 31st. The auto parts company reported $4.28 EPS for the quarter, beating the consensus estimate of $3.98 by $0.30. The firm had revenue of $6.21 billion during the quarter, compared to analysts' expectations of $6.15 billion. Lear had a net margin of 2.35% and a return on equity of 14.18%. The business's quarterly revenue was up 3.0% compared to the same quarter last year. During the same period in the prior year, the company earned $3.06 EPS. As a group, sell-side analysts expect that Lear will post 14.86 EPS for the current year.

Lear Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Tuesday, September 22nd. Stockholders of record on Wednesday, September 2nd will be paid a $0.77 dividend. The ex-dividend date is Wednesday, September 2nd. This represents a $3.08 dividend on an annualized basis and a dividend yield of 2.6%. Lear's dividend payout ratio is currently 28.70%.

Lear News Roundup

Here are the key news stories impacting Lear this week:

• Positive Sentiment: Lear’s latest reported quarter provided a fundamental counterpoint to the cautious coverage: earnings per share and revenue exceeded consensus expectations, while revenue increased year over year. However, no new earnings announcement was included in the latest articles.
• Neutral Sentiment: The other articles in the news feed concern unrelated topics, including Warren Buffett investing lessons, “King Lear” literary and theatrical coverage, cryptocurrencies, and other companies. They are not expected to affect Lear Corporation’s valuation or outlook.
• Negative Sentiment: Analysts have become more cautious on Lear Corporation, contributing to weakness in the shares. The report does not identify a new operational setback, but the change in analyst sentiment may reflect concerns about the auto-supply industry, earnings durability, or the company’s outlook. Lear Corporation stock falls as analysts turn more cautious
• Negative Sentiment: Wall Street Zen reportedly lowered its rating on Lear, reinforcing the broader analyst caution surrounding the stock. Rating reductions can weigh on sentiment even when they do not immediately change the company’s earnings outlook. Lear Stock Rating Lowered by Wall Street Zen

Lear Company Profile

Lear Corporation is a global automotive technology company that designs and manufactures systems and components used in passenger vehicles. Its business is organized primarily around two areas: seating and E-Systems. Lear supplies complete vehicle seating systems, including seats, structures, mechanisms, foam, covers and related components, as well as electrical distribution systems and other technologies that help manage power, data and connectivity within vehicles.

The company's E-Systems offerings include low- and high-voltage wiring systems, connection systems, battery and power-management solutions, electronic control modules, displays and software-enabled technologies.

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