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Lear
(NYSE:LEA)
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Rating:69Neutral
Price Target:
$131.00
▲(5.94% Upside)
Action:Reiterated
Date:10/20/26
LEA scores well on fundamentals and shareholder return potential: leverage reduction and improving free cash flow are meaningful positives, reinforced by raised guidance and increased buyback plans. The primary constraints are pressured TTM profitability/margins and a mixed technical setup (below key moving averages with negative MACD), with additional near-term headwinds from China weakness and E-Systems wind-down tempering the outlook.
Positive Factors
Robust OEM awards and backlog
Significant new awards and a visible backlog support revenue durability beyond current production cycles. Conquest programs and future launches can deepen OEM relationships, improve platform penetration, and provide a foundation for stronger growth as awards ramp in 2029–2030.
Negative Factors
Compressed and volatile margins
Persistently weak or volatile margins would limit the earnings benefit from revenue growth and leave Lear more exposed to input costs, mix changes, and execution issues. The gap versus recent annual profitability suggests that sustaining margin recovery remains an important fundamental challenge.
Read all positive and negative factors
Positive Factors
Negative Factors
Robust OEM awards and backlog
Significant new awards and a visible backlog support revenue durability beyond current production cycles. Conquest programs and future launches can deepen OEM relationships, improve platform penetration, and provide a foundation for stronger growth as awards ramp in 2029–2030.
Read all positive factors
Lear Key Performance Indicators (KPIs)
Any
Net Sales By Segment
Reveals revenue contributions from various business segments, helping investors understand which areas are performing well and which might need strategic adjustments.
Reveals revenue contributions from various business segments, helping investors understand which areas are performing well and which might need strategic adjustments.
Data provided by:
The Fly
The FlyLear (LEA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.76B
Dividend Yield2.64%
Average Volume (3M)591.41K
Price to Earnings (P/E)10.8
Beta (1Y)0.59
Revenue Growth3.55%
EPS Growth25.67%
CountryUS
Employees164,300
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Parts
Share Statistics
EPS (TTM)10.77
Shares Outstanding49,324,764
10 Day Avg. Volume428,465
30 Day Avg. Volume591,414
Financial Highlights & Ratios
PEG Ratio-1.57
Price to Book (P/B)1.21
Price to Sales (P/S)0.26
P/FCF Ratio11.56
Enterprise Value/Market Cap1.62
Enterprise Value/Revenue0.39
Enterprise Value/Gross Profit5.57
Enterprise Value/Ebitda6.39
Forecast
1Y Price Target
$143.56Price Target Upside16.10% Upside
Rating ConsensusHold
Number of Analyst Covering10
EPS Forecast (FY)14.98
Revenue Forecast (FY)$23.80B
Lear Business Overview & Revenue Model
Company Description
Lear Corporation, established in 1917 and headquartered in Southfield, Michigan, stands as a premier global supplier to the automotive industry. The company specializes in the conceptualization, development, engineering, manufacturing, and assembl...
How the Company Makes Money
Lear makes money by supplying automotive components and systems to vehicle manufacturers under awarded vehicle programs, generating revenue largely from the sale of (1) seating systems and components and (2) vehicle electrical distribution and con...
Lear Earnings Call Summary
Earnings Call Date:Jul 31, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 30, 2026
Earnings Call Sentiment Positive
The call presented a largely positive message: Lear delivered solid Q2 results with revenue up 3%, EPS up 23%, strong cash flow (operating cash flow +55%, free cash flow +69%) and meaningful business awards (~$2.9B YTD). Management raised full-year guidance modestly and highlighted substantial progress on automation, net performance, and margin expansion (notably in E-Systems). Offsetting factors include pronounced weakness in China (domestic sales down ~20% H1), the wind down of non-core E-Systems products ($90M in 2026, ~$235M in 2027), and near-term seasonal/production headwinds that are expected to limit growth in 2027. Overall, the company’s operational momentum, sizable backlog and automation-driven cost improvements outweigh the near-term regional and program-specific headwinds.Positive Updates
Revenue and EPS Growth
Q2 sales increased 3% year-over-year to $6.2 billion; record first-half revenue of over $12 billion. Adjusted earnings per share were $4.28, up 23% versus Q2 2025. Core operating earnings were $313 million, a 7% increase in the quarter (~9% for the first half).
Negative Updates
Weakness in China Market
Global production: China down 4% in Q2 and management noted domestic vehicle sales in China were down ~20% through the first half. Management built continued China weakness into second-half guidance and cited this as the primary reason for a more modest guidance raise.
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue and EPS Growth
Q2 sales increased 3% year-over-year to $6.2 billion; record first-half revenue of over $12 billion. Adjusted earnings per share were $4.28, up 23% versus Q2 2025. Core operating earnings were $313 million, a 7% increase in the quarter (~9% for the first half).
Read all positive updates
Company Guidance
Lear raised its full-year 2026 outlook, now targeting roughly $23.8 billion of revenue (about $165 million higher vs. prior midpoint) and core operating earnings of approximately $1.14 billion (up $25 million), with operating margins at about 4.8%; operating cash flow is expected to be about $1.3 billion and free cash flow roughly $640 million (a $40 million increase). The company also bumped its share-repurchase target to at least $350 million, reiterated Idea savings of $75 million for the year (about $35 million realized in H1) and expects $80 million of restructuring savings (about $50 million realized through Q2). Guidance assumptions include global industry production down less than 2% on a Lear sales‑weighted basis (vs. down 1% previously), average FX of $1.16/€ and RMB 6.82/$, a second‑half sales midpoint of ~$11.7 billion (down $289 million vs. H1 actuals) with H2 operating income midpoint ~$529 million (4.5% margin), and near‑term quarterly detail of Q3 revenue ~$5.8–5.9 billion with Seating margins in the low‑to‑mid 6% range and E‑Systems in the low 4% range; the update also reflects a ~$40 million revenue headwind from 301/232 tariff assumptions.Lear Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
74
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 23.70B | 23.26B | 23.30B | 23.46B | 20.88B | 19.26B |
| Gross Profit | 1.67B | 1.91B | 1.84B | 1.75B | 1.57B | 1.49B |
| EBITDA | 1.46B | 1.38B | 1.46B | 1.48B | 1.18B | 1.25B |
| Net Income | 556.00M | 436.80M | 506.60M | 572.50M | 327.70M | 373.90M |
Balance Sheet | ||||||
| Total Assets | 15.65B | 14.84B | 14.03B | 14.70B | 13.76B | 13.35B |
| Cash, Cash Equivalents and Short-Term Investments | 1.01B | 1.04B | 1.06B | 1.20B | 1.12B | 1.32B |
| Total Debt | 3.52B | 4.10B | 4.08B | 3.55B | 3.34B | 3.25B |
| Total Liabilities | 10.33B | 9.64B | 9.43B | 9.63B | 8.93B | 8.54B |
| Stockholders Equity | 5.18B | 5.04B | 4.45B | 4.92B | 4.68B | 4.64B |
Cash Flow | ||||||
| Free Cash Flow | 849.40M | 527.20M | 561.40M | 622.80M | 383.20M | 85.00M |
| Operating Cash Flow | 1.48B | 1.09B | 1.12B | 1.25B | 1.02B | 670.10M |
| Investing Cash Flow | -608.10M | -516.80M | -543.00M | -761.50M | -830.30M | -646.70M |
| Financing Cash Flow | -779.10M | -618.50M | -693.90M | -419.50M | -387.30M | -13.60M |
Lear Technical Analysis
Negative
123.65
Price Trends
122.74
Negative
129.23
Negative
127.52
Negative
Market Momentum
-1.37
Negative
39.97
Neutral
25.76
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LEA, the sentiment is Negative. The current price of 123.65 is above the 20-day moving average (MA) of 119.50, above the 50-day MA of 122.74, and below the 200-day MA of 127.52, indicating a bearish trend. The MACD of -1.37 indicates Negative momentum. The RSI at 39.97 is Neutral, neither overbought nor oversold. The STOCH value of 25.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LEA.
Lear Risk Analysis
Lear disclosed 30 risk factors in its most recent earnings report. Lear reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Lear Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $8.40B | 13.70 | 24.54% | 3.03% | 4.26% | -13.85% | |
69 Neutral | $5.76B | 10.83 | 10.90% | 2.64% | 3.55% | 25.67% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
59 Neutral | $1.89B | 20.58 | 6.44% | 1.83% | 1.94% | -67.19% | |
55 Neutral | $1.28B | 27.68 | 2.77% | 3.48% | 4.98% | ― | |
53 Neutral | $8.86B | 40.66 | 2.41% | 0.97% | -5.40% | -75.68% | |
53 Neutral | $4.35B | 11.17 | 15.85% | 2.32% | 7.71% | 9.67% |
* Consumer Cyclical Sector Average
LEA
Lear
116.69
17.46
17.59%
ALV
Autoliv
114.67
2.06
1.83%
APTV
Aptiv
42.69
-30.25
-41.48%
GNTX
Gentex
20.66
-2.56
-11.04%
VC
Visteon
76.37
-26.23
-25.57%
ADNT
Adient
16.61
-6.98
-29.59%
Lear Corporate Events
Business Operations and StrategyExecutive/Board Changes
Lear Announces Planned Chief Financial Officer Transition
Positive
Oct 19, 2026
On October 19, 2026, Lear Corporation announced a planned chief financial officer transition following a succession process, underscoring the company’s focus on leadership continuity and financial discipline. Longtime executive Jason Cardew,...
Business Operations and StrategyStock Buyback
Lear boosts share repurchase authorization, affirms cash strategy
Positive
Sep 24, 2026
On September 24, 2026, Lear Corporation announced that its board approved an increase of the company’s share repurchase authorization to $1.5 billion and extended the program’s term to December 31, 2029. The move reflects the boardR...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.