Autoliv Inc (NYSE: ALV)

Sector: Consumer Cyclical Industry: Auto Parts CIK: 0001034670
Market Cap 9.72 Bn
P/B 3.81
P/E 12.92
P/S 0.92
ROIC (Qtr) 16.76
Div Yield % 2.36
Rev 1y % (Qtr) 5.91
Total Debt (Qtr) 2.19 Bn
Debt/Equity (Qtr) 0.86

About

Autoliv Inc., with its ticker symbol ALV, is a prominent player in the automotive industry, specializing in the design, production, and distribution of passive safety systems. The company, headquartered in Stockholm, Sweden, and incorporated in Delaware, is a global leader in its field, providing essential safety components to many of the world's largest automakers. Autoliv's primary business activities revolve around the development and manufacture of passive safety systems. These systems encompass a wide range of products, including airbags,...

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Price action

Investment thesis

Bull case

  • Strong operating cash flow of 1.03B provides robust 0.47x coverage of total debt 2.19B, indicating excellent debt servicing capability and financial flexibility.
  • Strong tangible asset base of 7.08B provides 3.23x coverage of total debt 2.19B, indicating robust asset backing and low credit risk.
  • Strong operating cash flow of 1.03B provides 1.85x coverage of SG&A expenses 558M, showing efficient operational cost management.
  • Retained earnings of 2.27B provide full 1.52x coverage of long-term debt 1.49B, indicating strong internal capital position.
  • Tangible assets of 7.08B provide robust 4.55x coverage of other current liabilities 1.55B, indicating strong asset backing.

Bear case

  • Operating cash flow of 1.03B barely covers its investment activities of (445M), with a coverage ratio of -2.32, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • With cash reserves of 225M against inventory of 1.04B, the 0.22 cash-to-inventory ratio suggests potential liquidity risks if inventory turnover slows, particularly concerning given current supply chain volatilities.
  • Operating cash flow of 1.03B provides thin coverage of dividend payments of (228M) with a -4.53 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Investment activities of (445M) provide weak support for R&D spending of 392M, which is -1.14x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • High receivables of 2.36B relative to inventory of 1.04B (2.28 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.

Geographical Breakdown of Revenue (2024)

Product and Service Breakdown of Revenue (2024)

Peer comparison

Companies in the Auto Parts
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 ORLY O Reilly Automotive Inc 80.07 Bn 32.23 4.59 8.40 Bn
2 AZO Autozone Inc 57.24 Bn 23.23 2.97 12.05 Bn
3 APTV Aptiv PLC 19.67 Bn 66.67 0.98 8.03 Bn
4 GPC Genuine Parts Co 17.83 Bn 22.05 0.74 6.40 Bn
5 MGA Magna International Inc 15.86 Bn 15.36 0.38 7.48 Bn
6 ALV Autoliv Inc 9.72 Bn 12.92 0.92 2.19 Bn
7 MBLY Mobileye Global Inc. 9.47 Bn -28.17 4.88 0.00 Bn
8 BWA Borgwarner Inc 8.87 Bn 66.21 0.63 3.90 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.38 1.16
EV to Cash from Ops. EV/CFO 11.32 9.30
EV to Debt EV to Debt 5.34 34.64
EV to EBIT EV/EBIT 10.47 4.45
EV to EBITDA EV/EBITDA 7.90 7.40
EV to Free Cash Flow [EV/FCF] EV/FCF 19.86 17.25
EV to Market Cap EV to Market Cap 1.20 1.58
EV to Revenue EV/Rev 1.10 3.42
Price to Book Value [P/B] P/B 3.81 -0.33
Price to Earnings [P/E] P/E 12.92 11.70
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 3.30 1.64
Dividend Payout Ratio % Div Payout % (Qtr) 30.50 12.18
Dividend per Basic Share Div per Share (Qtr) 2.95 0.41
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 38.27 13.70
Interest Coverage Int. cover (Qtr) 10.74 -110.44
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 23.58 -13.49
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -45.78 27.17
Dividend Growth (1y) % Div 1y % (Qtr) 8.46 1.96
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 15.88 5.41
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 27.59 -8.06
EBIT Growth (1y) % EBIT 1y % (Qtr) 27.51 -22.36
EBT Growth (1y) % EBT 1y % (Qtr) 31.56 -123.98
EPS Growth (1y) % EPS 1y % (Qtr) 26.04 -110.42
FCF Growth (1y) % FCF 1y % (Qtr) 16.63 24.26
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 7.60 16.01
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.25 0.92
Cash Payout Ratio Cash Payout (Qtr) 0.15 -0.25
Cash Ratio Cash Ratio (Qtr) 0.05 0.69
Current Ratio Curr Ratio (Qtr) 0.95 2.88
Debt to Equity Ratio Debt/Equity (Qtr) 0.86 0.22
Interest Cover Ratio Int Coverage (Qtr) 10.74 -110.44
Times Interest Earned Times Interest Earned (Qtr) 10.74 -110.44
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 14.30 -952.44
EBIT Margin % EBIT Margin % (Qtr) 10.52 -997.37
EBT Margin % EBT Margin % (Qtr) 9.54 -987.56
Gross Margin % Gross Margin % (Qtr) 19.30 -122.43
Net Profit Margin % Net Margin % (Qtr) 7.10 -979.78