Strattec Security Corporation engages in the design, development, manufacture, and marketing of automotive access control products under the VAST brand name primarily in the United States. The company is based in Milwaukee, Wisconsin.
STRT 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 Strattec Security Corp. To summarize, we found that Strattec Security Corp ranked in the 68th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 123% on a DCF basis. In terms of the factors that were most noteworthy in this DCF analysis for STRT, they are:
Strattec Security Corp's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at -1.64. This coverage rate is greater than that of only 18.5% of stocks we're observing for the purpose of forecasting via discounted cash flows.
Relative to other stocks in its sector (Consumer Cyclical), Strattec Security Corp has a reliance on debt greater than only 22.27% of them.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
VIRC, LCII, KIRK, QNST, and LKQ can be thought of as valuation peers to STRT, in the sense that they are in the Consumer Cyclical sector and have a similar price forecast based on DCF valuation.
Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
Strattec Security Corporation (STRT) is a company that designs and manufactures lock and key products for automotive vehicles. The company also manufactures technology-enabled locks and keys, 'passive entry passive start systems', latches, and door handles. The company supplies to original equipment manufacturers including Fiat Chrysler (FCAU), General Motors (GM), and...
Ophelia Research on Seeking Alpha | December 21, 2020