Aptiv's Growth Trajectory Hits Speed Bump: Morgan Stanley Lowers Forecast
Portfolio Pulse from Lekha Gupta
Morgan Stanley downgraded Aptiv PLC (NYSE:APTV) to Underweight from Equal-Weight and lowered its price target to $74 from $90, following Aptiv's Q4 FY23 results. The company reported a 6% year-over-year net sales growth to $4.92 billion, missing the consensus of $5.07 billion, but its adjusted EPS of $1.40 beat the consensus of $1.33. Aptiv's FY24 net sales forecast is $21.3 billion-$21.9 billion versus the consensus of $21.61 billion, with adjusted EPS of $5.55 – $6.05 against the consensus of $5.78. The downgrade reflects concerns over slowing EV demand and OEMs' willingness to produce them, impacting Aptiv's growth-over-market assumption.
February 07, 2024 | 7:08 pm
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Morgan Stanley downgraded Aptiv PLC to Underweight and lowered its price target to $74 from $90, citing concerns over slowing EV demand and OEM production willingness, impacting growth forecasts.
The downgrade by Morgan Stanley is a significant negative catalyst for Aptiv's stock in the short term. The reduction in price target and the downgrade to Underweight reflect concerns over the company's growth prospects, particularly in the EV sector, which is a critical area of focus for Aptiv. The analyst's concerns about slowing demand for EVs and OEMs' willingness to produce them directly impact the company's growth-over-market assumptions, leading to a negative outlook on the stock's performance.
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