Is Aptiv PLC (APTV) Modestly Undervalued? A Comprehensive Analysis

Exploring the intrinsic value and financial performance of Aptiv PLC (APTV)

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With a daily loss of -4.34%, a three-month gain of 4.68%, and an Earnings Per Share (EPS) of 3.29, Aptiv PLC (APTV, Financial) presents an interesting case for value investors. This article aims to answer the question: Is Aptiv PLC (APTV) modestly undervalued? We delve into the company's financials, growth, and valuation to provide a comprehensive analysis.

Company Overview

Aptiv PLC's signal and power solutions segment supplies components and systems that make up a vehicle's electrical system. This includes wiring assemblies and harnesses, connectors, electrical centers, and hybrid electrical systems. The advanced safety and user experience segment provides body controls, infotainment and connectivity systems, passive and active safety electronics, advanced driver-assist technologies, and displays, as well as the development of software for these systems.

Aptiv PLC's largest customers are General Motors and Stellantis, both at roughly 9% of 2022 revenue, followed by Ford and Volkswagen, both at 8%. North America and Europe represented approximately 37% and 31% of total 2022 revenue, respectively.

The company's stock price is currently at $98.7, while its GF Value, an estimation of fair value, stands at $135.2. This suggests that Aptiv PLC (APTV, Financial) may be modestly undervalued.


Understanding GF Value

The GF Value is a proprietary measure of a stock's intrinsic value. It is derived from historical trading multiples, a GuruFocus adjustment factor based on past returns and growth, and future business performance estimates. The GF Value Line on our summary page gives an overview of the fair value at which the stock should ideally trade.

According to our analysis, Aptiv PLC (APTV, Financial) appears to be modestly undervalued. The stock's fair value is determined by historical multiples, an internal adjustment based on the company's past business growth, and analyst estimates of future business performance. If the share price is significantly above the GF Value Line, the stock may be overvalued and have poor future returns. Conversely, if the share price is significantly below the GF Value calculation, the stock may be undervalued and have higher future returns.

Given that Aptiv PLC is relatively undervalued, the long-term return of its stock is likely to be higher than its business growth.


Link: These companies may deliver higher future returns at reduced risk.


I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.