Magna International (NYSE:MGA) Releases Quarterly Earnings Results, Beats Expectations By $0.37 EPS

Key Points

• Q1 beat: Magna reported adjusted EPS of $1.38 vs. consensus $1.01 and revenue of $10.4B (+3%), with adjusted EBIT up 58% to $558M and margin expanding to 5.4%, helped by >$450M of customer recoveries and strong cash generation (operating cash flow $677M, free cash flow $372M).
• Guidance and one‑offs: Management reaffirmed FY2026 adjusted EPS of $6.25–$7.25 and an adjusted EBIT margin target of 6.0%–6.6%, but the quarter included a >$400M GAAP impairment tied to planned disposals (lighting and rooftop businesses, ~ $350M sales), which contributed to a small GAAP loss and the stock sliding ~4.4%.
• Capital return: Magna declared a quarterly dividend of $0.495 ($1.98 annualized) for a ~3.3% yield, with an ex‑dividend date of May 15 and payable May 29.

Magna International (NYSE:MGA - Get Free Report) TSE: MG issued its quarterly earnings data on Friday. The company reported $1.38 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.01 by $0.37, Briefing.com reports. Magna International had a return on equity of 12.73% and a net margin of 1.99%.The firm's revenue was up 3.1% compared to the same quarter last year. During the same quarter in the previous year, the business posted $0.78 EPS. Magna International updated its FY 2026 guidance to 6.250-7.250 EPS.

Here are the key takeaways from Magna International's conference call:

• Very strong Q1 results: Sales were $10.4B (+3%), adjusted EBIT rose 58% to $558M with margin up 190 bps to 5.4%, adjusted EPS was $1.38 (+77%), and the company generated $677M operating cash flow and $372M free cash flow with $1.6B cash on hand.
• Management reaffirmed its 2026 outlook (weighted sales growth ~1.5% over market at midpoint; adjusted EBIT margin 6.0%–6.6%; adjusted EPS $6.25–$7.25; FCF $1.6B–$1.8B) and expects EBIT to be back‑half weighted.
• Portfolio actions: Magna announced margin‑accretive dispositions of its lighting and rooftop systems businesses (expected to close in H2) that remove roughly $350M of sales with minimal reported earnings/FCF impact, while recording a >$400M GAAP impairment in Q1 (excluded from adjusted results).
• Cash and commercial recoveries materially boosted results — the quarter included >$450M of balance‑sheet customer recoveries for prior EV investments and a favorable Power & Vision equity settlement ( ~60 bps of margin benefit) that arrived earlier than planned.
• Operational excellence is driving margin upside: the company delivered ~80 bps of operational improvement in Q1 (above the 35–40 bps target), which management says could offer further upside if sustained, though they remain measured on cadence and sustainability.

Magna International Stock Down 4.4%

Shares of NYSE MGA traded down $2.83 during mid-day trading on Friday, reaching $60.84. 4,090,099 shares of the company were exchanged, compared to its average volume of 1,922,801. The company has a quick ratio of 0.87, a current ratio of 1.25 and a debt-to-equity ratio of 0.36. The stock has a market cap of $16.69 billion, a price-to-earnings ratio of 20.62 and a beta of 1.44. Magna International has a 1 year low of $32.54 and a 1 year high of $69.94. The firm has a 50-day moving average of $58.59 and a 200 day moving average of $54.25.

Magna International Announces Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Friday, May 29th. Investors of record on Friday, May 15th will be paid a dividend of $0.495 per share. This represents a $1.98 dividend on an annualized basis and a dividend yield of 3.3%. The ex-dividend date is Friday, May 15th. Magna International's dividend payout ratio is 67.12%.

Wall Street Analysts Forecast Growth

Several brokerages have recently issued reports on MGA. Citigroup upped their price objective on Magna International from $55.00 to $58.00 and gave the stock a "neutral" rating in a report on Monday, March 23rd. Wells Fargo & Company decreased their price objective on Magna International from $69.00 to $59.00 and set an "equal weight" rating on the stock in a report on Tuesday, March 31st. UBS Group decreased their price objective on Magna International from $70.00 to $62.00 and set a "neutral" rating on the stock in a report on Tuesday, April 14th. The Goldman Sachs Group decreased their price objective on Magna International from $60.00 to $52.00 and set a "sell" rating on the stock in a report on Tuesday, April 14th. Finally, Canadian Imperial Bank of Commerce raised Magna International from a "neutral" rating to an "outperformer" rating and upped their price objective for the stock from $56.00 to $76.00 in a report on Wednesday, February 18th. One equities research analyst has rated the stock with a Strong Buy rating, six have assigned a Buy rating, ten have assigned a Hold rating and one has issued a Sell rating to the stock. According to data from MarketBeat.com, Magna International presently has an average rating of "Hold" and an average price target of $62.40.

Key Magna International News

Here are the key news stories impacting Magna International this week:

• Positive Sentiment: Adjusted performance beat expectations — Adjusted EPS of $1.38 topped consensus, Adjusted EBIT rose 58% and adjusted margin expanded materially, signaling underlying operational improvement. GlobeNewswire Q1 Release
• Positive Sentiment: Revenue and cash flow resilience — Sales grew ~3% to $10.4B despite a 7% global light-vehicle production decline, and free cash flow turned positive, supporting buybacks and the dividend. GlobeNewswire Q1 Release
• Neutral Sentiment: Full‑year outlook maintained but mixed vs. Street — Magna kept FY 2026 adjusted EPS guidance at $6.25–$7.25 and unchanged margin/free-cash flow ranges; the EPS band’s midpoint is close to consensus but the low end is below Street expectations, leaving interpretation mixed. GlobeNewswire Q1 Release
• Negative Sentiment: GAAP headline loss and one‑time charge weighed on sentiment — Magna reported a net loss attributable to the company (~$12M) driven by a $485M pre‑tax loss on assets held for sale tied to planned disposals in Power & Vision, which flagged near‑term GAAP volatility. GlobeNewswire Q1 Release
• Negative Sentiment: Softer production assumptions — Management nudged down North American and European light‑vehicle production assumptions versus prior guidance, implying potential near‑term volume pressure for auto suppliers like Magna. QuiverQuant Coverage
• Negative Sentiment: Analyst / price‑target pressure — At least one broker note reaffirmed a sector‑perform view with a sub‑current price target, which can add selling pressure after the report. MarketScreener: RBC Note

Institutional Investors Weigh In On Magna International

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the business. State of Tennessee Department of Treasury raised its stake in Magna International by 0.6% in the fourth quarter. State of Tennessee Department of Treasury now owns 157,482 shares of the company's stock valued at $8,095,000 after buying an additional 937 shares during the last quarter. Russell Investments Group Ltd. increased its holdings in shares of Magna International by 7.8% in the fourth quarter. Russell Investments Group Ltd. now owns 2,090,887 shares of the company's stock valued at $111,549,000 after purchasing an additional 151,819 shares during the period. Atlas Capital Advisors Inc. acquired a new position in shares of Magna International in the fourth quarter valued at about $67,000. Arkadios Wealth Advisors increased its holdings in shares of Magna International by 7.3% in the fourth quarter. Arkadios Wealth Advisors now owns 4,767 shares of the company's stock valued at $254,000 after purchasing an additional 324 shares during the period. Finally, Van ECK Associates Corp grew its holdings in Magna International by 2.6% during the fourth quarter. Van ECK Associates Corp now owns 9,114 shares of the company's stock worth $486,000 after acquiring an additional 235 shares during the period. 67.49% of the stock is currently owned by hedge funds and other institutional investors.

About Magna International

Magna International Inc is a leading global automotive supplier specializing in the design, engineering, and manufacturing of vehicle systems, assemblies, modules, and components. Headquartered in Aurora, Ontario, the company partners with major original equipment manufacturers (OEMs) to develop technologies and solutions that enhance vehicle performance, safety, comfort, and fuel efficiency. Magna's broad portfolio encompasses body exteriors and structures, powertrain systems, seating and interiors, roof systems, mirror systems, and advanced driver assistance systems (ADAS).

The company operates more than 350 manufacturing and assembly facilities and over 100 innovation centers across 27 countries, serving customers in North America, Europe, Asia, South America, and Africa.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.