Magna International develops, manufactures, engineers, supplies, and sells automotive products. It operates through North America, Europe, Asia, and Rest of World segments. The company was founded in 1957 and is based in Aurora, Canada.
MGA Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Magna International Inc. To summarize, we found that Magna International Inc ranked in the 75th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 271.33%. As for the metrics that stood out in our discounted cash flow analysis of Magna International Inc, consider:
As a business, MGA is generating more cash flow than 95.3% of positive cash flow stocks in the Consumer Cyclical.
Magna International Inc's weighted average cost of capital (WACC) is 7%; for context, that number is higher than only 16.02% of tickers in our DCF set.
MGA's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than only 16.02% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
SBGI, UONE, AMWD, UFPT, and CTIB can be thought of as valuation peers to MGA, in the sense that they are in the Consumer Cyclical sector and have a similar price forecast based on DCF valuation.
Moody's Investors Service, ("Moody's") has confirmed Magna International Inc.'s ("Magna") A3 LT Issuer Rating, (P)A3 Senior Unsecured Shelf rating, and A3 Senior Unsecured Notes rating. At the same time the company's P-2 Commercial Paper rating has been affirmed.
If the U.S. and China conflict blows over, Canada will be caught in the middle. The Canada Goose stock and Magna International stock might suffer from the backlash as both businesses rely on the huge Chinese market for growth. The post China vs. America: Why Canadian Investors Should Worry appeared first on The Motley Fool Canada .
Investors seeking the next generation of ethical upside have some intriguing stocks to choose from, such as Magna International Inc. (TSX:MG)(NYSE:MGA). The post Young Investors Will Drive Upside in These TSX Stocks appeared first on The Motley Fool Canada .