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Martinrea International (MRE) AI Stock Analysis
Martinrea International
(TSX:MRE)
The score is driven primarily by mid-range financial performance: improved profitability and acceptable leverage are tempered by declining revenue and weak cash conversion. Valuation is a clear positive with a low P/E and a modest yield, while the earnings call supports a constructive outlook via reaffirmed guidance and new business wins despite near-term margin and Europe headwinds. Technicals are mixed as momentum is positive but the price remains below key moving averages.
Martinrea International (MRE) vs. iShares MSCI Canada ETF (EWC)
- Market Cap
- CAD 475.83M
- Dividend Yield
- 2.11%
- Average Volume (3M)
- 87.91K
- Price to Earnings (P/E)
- 5.5
- Beta (1Y)
- 1.34
- Revenue Growth
- -2.65%
- EPS Growth
- ―
- Country
- Canada
- Employees
- 16,000
- Sector
- Consumer Cyclical
- Sector Strength
- 61
- Industry
- Auto - Parts
Martinrea International Business Overview & Revenue Model
Company Description
Martinrea International Inc. specializes in the design, development, manufacture, and distribution of a diverse range of metal components, sub-assemblies, fluid management systems, and aluminum products. These offerings primarily cater to the global...
How the Company Makes Money
Martinrea makes money mainly by manufacturing and selling automotive components and systems to vehicle OEMs under long-term vehicle program supply arrangements. Revenue is primarily generated from (1) metal forming and assembly products (e.g., stampe...
Martinrea International Earnings Call Summary
The call presented a predominantly constructive operational and financial picture: management reinforced disciplined capital allocation, continued share repurchases, meaningful new business awards (CAD 110M this quarter; CAD 440M in last 12 months), sequential margin improvement and strong free cash flow generation with net debt reduction. Offsetting items include notable near-term headwinds in Europe (CAD 7.5M loss), temporary margin pressure from an aluminum price spike (~40 bps) and lost volume from the Ford Escape program which weigh on year‑over‑year margins. Management reaffirmed full‑year 2026 guidance and outlined a clear multi-year margin and revenue target for 2028, indicating confidence in recovery actions and the long‑term plan.
Q2-2026 Updates
Positive Updates
Negative Updates
Company Guidance
Martinrea reaffirmed its 2026 guidance: total sales of CAD 4.5–4.9 billion, adjusted operating income margin of 5.5%–6.0%, free cash flow of CAD 125–175 million and roughly CAD 300 million of CapEx (roughly in line with D&A); management said the company is on track to meet that outlook despite temporary headwinds (Q2 adjusted operating margin 5.9%, Q2 adjusted EPS CAD 0.61, reported free cash flow before IFRS16 principal CAD 52.8M / after CAD 36.9M, net debt CAD 801M down from CAD 819M, net debt/adjusted EBITDA ~1.63x vs a 1.5x target). They reiterated longer‑term 2028 targets of CAD 5.3–5.5 billion in sales and a 6.5%–7.0% adjusted operating margin, noted Europe is expected to approach breakeven for full‑year 2026 and improve in 2027, and highlighted near‑term drivers and puts/takes including a ~90‑day lagged aluminum pass‑through (aluminum headwind ~40 bps YoY), Q2 sequential margin improvement of ~40 bps, CAD 440M of new awards in the last 12 months (CAD 110M announced this quarter), cumulative new business since 2023 > CAD 1B, and ongoing capital return (919k shares repurchased for CAD 10M this quarter; materially active NCIB).
Martinrea International Financial Statement Overview
Summary
Earnings and margins improved materially versus 2024 with positive profitability in 2025 and TTM, and leverage has moderated (debt-to-equity ~0.71 TTM). Offsetting this, revenue has declined for two annual periods and remains slightly negative in TTM, while cash conversion is weak (TTM free cash flow ~41% of net income) and FCF growth is negative, reducing flexibility through the cycle.
Income Statement
66PositiveBalance Sheet
63PositiveCash Flow
54Neutral| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.70B | 4.82B | 5.01B | 5.34B | 4.76B | 3.78B |
| Gross Profit | 623.35M | 623.65M | 648.56M | 675.40M | 559.26M | 345.62M |
| EBITDA | 546.91M | 499.29M | 475.17M | 597.92M | 516.59M | 328.40M |
| Net Income | 122.40M | 106.98M | -34.55M | 153.66M | 132.84M | 35.88M |
Balance Sheet | ||||||
| Total Assets | 4.00B | 3.74B | 3.82B | 3.99B | 4.14B | 3.61B |
| Cash, Cash Equivalents and Short-Term Investments | 109.59M | 174.14M | 167.95M | 186.80M | 161.66M | 153.29M |
| Total Debt | 1.15B | 1.12B | 1.22B | 1.23B | 1.34B | 1.25B |
| Total Liabilities | 2.39B | 2.23B | 2.35B | 2.52B | 2.77B | 2.44B |
| Stockholders Equity | 1.61B | 1.51B | 1.47B | 1.47B | 1.38B | 1.17B |
Cash Flow | ||||||
| Free Cash Flow | 157.81M | 183.59M | 150.54M | 207.57M | 53.96M | -118.73M |
| Operating Cash Flow | 386.50M | 430.49M | 433.29M | 511.09M | 437.78M | 180.03M |
| Investing Cash Flow | -239.77M | -257.35M | -285.50M | -303.75M | -381.27M | -305.86M |
| Financing Cash Flow | -159.23M | -165.48M | -167.43M | -180.72M | -41.72M | 129.93M |
Martinrea International Technical Analysis
Price Trends
Market Momentum
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:MRE, the sentiment is Negative. The current price of 9.46 is below the 20-day moving average (MA) of 9.68, below the 50-day MA of 10.00, and below the 200-day MA of 10.06, indicating a bearish trend. The MACD of -0.16 indicates Negative momentum. The RSI at 38.07 is Neutral, neither overbought nor oversold. The STOCH value of 62.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:MRE.
Martinrea International Peers Comparison
Overall Rating
TSE:LNR83Outperform
TSE:XTC74Outperform
TSE:NFI68Neutral- TSE:MRE65Neutral
TSE:MG62Neutral
TSE:BYD48Neutral
Financial Indicators
| Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| TSE:LNR | 83Outperform | CAD 5.22B | 7.70 | 10.96% | 1.34% | 9.32% | 227.52% |
| TSE:XTC | 74Outperform | CAD 316.77M | 13.00 | 6.04% | 4.97% | 0.52% | 5.03% |
| TSE:NFI | 68Neutral | CAD 2.91B | 36.72 | 10.42% | ― | 14.75% | ― |
| TSE:MRE | 65Neutral | CAD 661.96M | 5.53 | 7.89% | 2.11% | -2.65% | ― |
| TSE:MG | 62Neutral | CAD 23.60B | 20.62 | 6.97% | 3.06% | 0.36% | -14.27% |
| Sector * | 61Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% |
| TSE:BYD | 48Neutral | CAD 3.26B | 180.83 | 0.61% | 0.53% | 16.14% | 22.41% |
* Consumer Cyclical Sector Average
Performance Comparison
| Show on chart | Ticker | Company Name | Price | Change | % Change |
|---|---|---|---|---|---|
| TSE:MRE | Martinrea International Inc. | 9.46 | -0.58 | -5.81% | |
| TSE:MG | Magna International | 88.91 | 21.86 | 32.61% | |
| TSE:XTC | Exco Technologies Limited | 8.45 | 2.24 | 36.05% | |
| TSE:LNR | Linamar Corp. | 88.50 | 13.14 | 17.44% | |
| TSE:NFI | NFI Group | 24.40 | 10.12 | 70.87% | |
| TSE:BYD | Boyd Group Services Inc | 117.26 | -106.51 | -47.60% |
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.
Date of analysis: Aug 25, 2026