Garrett Motion (NYSE:GTX) Shares Gap Up After Earnings Beat

Key Points

• Garrett Motion beat expectations, reporting EPS of $0.49 vs. the $0.43 consensus and revenue up 12.2%, which sent the stock gapping higher from $20.49 to an intraday trade around $24.26 (up ~20.3%).
• Significant insider selling has occurred recently — the CEO sold 144,000 shares and insiders have disposed of 337,000 shares in the last 90 days, leaving insiders with just 1.10% ownership.
• The company pays a quarterly dividend of $0.08 (annualized yield ~1.3%), while analysts maintain a consensus rating of "Moderate Buy" with an average price target of $18.80 despite some higher individual targets.

Garrett Motion Inc. (NYSE:GTX - Get Free Report) gapped up prior to trading on Thursday following a stronger than expected earnings report. The stock had previously closed at $20.49, but opened at $22.14. Garrett Motion shares last traded at $24.2640, with a volume of 828,974 shares.

The company reported $0.49 earnings per share for the quarter, beating the consensus estimate of $0.43 by $0.06. Garrett Motion had a negative return on equity of 38.75% and a net margin of 8.12%.The company's quarterly revenue was up 12.2% on a year-over-year basis.

Garrett Motion Dividend Announcement

The business also recently announced a quarterly dividend, which was paid on Monday, March 16th. Shareholders of record on Monday, March 2nd were issued a dividend of $0.08 per share. This represents a $0.32 annualized dividend and a yield of 1.3%. The ex-dividend date was Monday, March 2nd. Garrett Motion's dividend payout ratio (DPR) is 21.05%.

Analysts Set New Price Targets

GTX has been the topic of several recent research reports. BWS Financial restated a "buy" rating and set a $22.00 target price on shares of Garrett Motion in a report on Thursday, April 9th. Freedom Capital upgraded Garrett Motion to a "strong-buy" rating in a report on Monday, April 6th. One equities research analyst has rated the stock with a Strong Buy rating, four have given a Buy rating and two have given a Hold rating to the stock. According to data from MarketBeat, the company currently has a consensus rating of "Moderate Buy" and an average price target of $18.80.

Insider Activity

In other news, Director Julia Steyn sold 17,000 shares of the firm's stock in a transaction dated Tuesday, February 24th. The stock was sold at an average price of $19.86, for a total value of $337,620.00. Following the sale, the director directly owned 50,233 shares of the company's stock, valued at approximately $997,627.38. This trade represents a 25.29% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, CEO Olivier Rabiller sold 144,000 shares of the firm's stock in a transaction dated Friday, February 27th. The shares were sold at an average price of $20.32, for a total value of $2,926,080.00. Following the completion of the sale, the chief executive officer directly owned 905,546 shares in the company, valued at approximately $18,400,694.72. This represents a 13.72% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last ninety days, insiders have sold 337,000 shares of company stock valued at $6,839,290. 1.10% of the stock is owned by insiders.

Institutional Investors Weigh In On Garrett Motion

A number of institutional investors have recently added to or reduced their stakes in the company. Robeco Institutional Asset Management B.V. acquired a new stake in shares of Garrett Motion during the 3rd quarter worth approximately $5,925,000. JPMorgan Chase & Co. increased its position in shares of Garrett Motion by 45.1% during the third quarter. JPMorgan Chase & Co. now owns 1,705,484 shares of the company's stock valued at $23,229,000 after purchasing an additional 529,949 shares during the period. Convergence Investment Partners LLC bought a new stake in shares of Garrett Motion during the third quarter valued at approximately $1,573,000. Federated Hermes Inc. bought a new stake in shares of Garrett Motion during the third quarter valued at approximately $1,646,000. Finally, Renaissance Group LLC bought a new stake in shares of Garrett Motion during the third quarter valued at approximately $1,156,000. 86.27% of the stock is owned by institutional investors and hedge funds.

Garrett Motion Stock Up 20.3%

The firm has a market capitalization of $4.64 billion, a P/E ratio of 19.54 and a beta of 0.44. The business has a 50-day moving average price of $18.96 and a 200-day moving average price of $17.85.

Garrett Motion Company Profile

Garrett Motion Inc is a technology leader specializing in the design, development and manufacture of turbocharging systems and related technologies for the global automotive industry. Its product portfolio includes conventional exhaust gas turbochargers, variable-geometry turbochargers, electric and e-boost turbochargers, as well as electronic actuators, sensors and thermal management systems. The company's solutions are engineered to improve engine efficiency, reduce emissions and support automakers' efforts to meet evolving regulatory standards for fuel economy and air quality.

Garrett Motion traces its roots to the founding of AiResearch by Cliff Garrett in 1936, a pioneer in aircraft and automotive turbocharging technologies.

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