I had previously written that I thought Valeo (OTCPK:VLEEY) (VLOF.PA)
shares could remain weak as the company stumbled through a weak
transitional period, but I didn’t expect the shares to fall by a third
on a year-to-date basis. Granted, the sector has been weak (BorgWarner (BWA) is down about 12% year-to-date, as is Schaeffler (OTC:SCFLF), and Continental (OTCPK:CTTAY) and Faurecia (OTCPK:FURCY)
are down closer to 15%), but it seems like the shares have been
hammered beyond what admittedly weaker-than-expected near-term results
would other deserve.
Valeo management is calling for
double-digit revenue growth next year, but the sell-side’s stance seems
to be more along the lines of “yeah, sure you will…” and the market is
not giving much credit for a backlog that should drive meaningful growth
in few years’ time, particularly in new hybrid and EV programs.
Although Valeo’s performance is doing nothing to build confidence today,
if management can deliver better results in the fourth quarter (the
third quarter is not looking promising), maybe these shares will finally
recapture a little investor support.
Valeo Pounded Down On A Weak Transition Period
No comments:
Post a Comment