MGA changes
Pick any two versions below to diff them.
- Price
- $65.99 → $63.83(−3.3%)
- Discount
- 4% to 29% → 7% to 31%(+3.0 pts)
- Next earnings
- 2026-11-02 → 2026-10-30
- Next earnings is estimate
- Yes → No
- Thesis
- The market prices Magna for the risks of the auto cycle. Global light vehicle production fell 2% in Q2 2026, with lower production in North America, Europe and China. Tariffs, price concessions to car makers and the end of some programs put pressure on sales and margins, and the Complete Vehicles business depends on a few contracts. Investors fear that car makers produce fewer vehicles in 2027 and that Magna cannot keep its recent margin gains. For the gap to close, three things must be true. Magna must reach its raised 2026 outlook of an Adjusted EBIT margin of 6.3% to 6.6% and free cash flow of $1.75 billion to $1.85 billion. It must recover most tariff costs from its customers. Its 2027 outlook, which it usually gives in February, must show further margin growth even if vehicle production stays flat. The Q3 2026 report on October 30, expected in early November 2026, and the 2027 outlook in February 2027 give the next evidence. If these checks pass, the gap can close over the next three to five quarters. The main reason it may not close is a fall in vehicle production, which lowers volume and margins at the same time.
- Checkpoints
- Nov 2Oct 30, 2026 (estimate): Q3 2026 earnings: margin outlook. Pending. Watch: Results that keep the 6.3% to 6.6% Adjusted EBIT margin outlook and the free cash flow outlook pass; a cut to the outlook fails. Feb 2027 (estimate): 2027 outlook. Pending. Watch: An outlook for a higher Adjusted EBIT margin in 2027 passes; a lower margin outlook because of weak production fails.