Value
7.8/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 3.7 |
| P/S | 9.9 |
| EV/EBITDA | 8.2 |
| Fwd P/E | 9.5 |
| PEG | 7.3 |
| Analyst target | 7.5 |
- ▸Forward P/E: 8.6x
- ▸PEG: 0.95
- ▸Attractively valued
APTV · Why this verdict
Why Aptiv (APTV) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.1/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Free cash flow converts at 299% of reported net income, meaning the business generates nearly three times more cash than GAAP earnings suggest, supported by a Piotroski F-score of 7 out of 9 that signals broad financial health despite modest reported margins. Quality breakdown | Free cash flow to net income ratio remains above 150% for the next four quarters, confirming durable cash generation above reported earnings. | →Stable |
| CounterWith no identified competitive moat and weak gross margin characteristics, the strong cash conversion may reflect asset-light timing dynamics or low capital intensity in the near term; a structural deterioration in the product mix could quickly erode both reported margins and cash generation simultaneously. | ||
At a forward price-to-earnings of 9.8 times and a price/earnings-to-growth ratio of 1.07, the stock screens as attractively valued relative to its earnings and growth trajectory — the bundle explicitly characterizes it as attractively valued. Valuation breakdown | Forward earnings per share expands enough to keep the forward price-to-earnings ratio below 12 times over the next 12 months, validating the low-multiple entry thesis. | →Stable |
| CounterValuation multiples can remain compressed for extended periods when business quality is below average and momentum is in a confirmed downtrend; screens cheap is not the same as the catalyst that closes the gap exists. | ||
The top 10 customers account for 56% of total revenue, meaning a significant portion of the business depends on a small set of relationships; loss or material reduction in orders from any major customer could produce a disproportionate impact on the revenue base. Bear case | Revenue from the top 10 customers falls below 45% of total revenue within 18 months, reflecting meaningful diversification of the customer base. | →Stable |
| CounterIn the auto parts industry, deep integration with a small number of large vehicle manufacturers can reflect genuine switching costs and long-cycle program awards rather than fragile concentration; established relationships may be more durable than the concentration percentage implies. | ||
Price momentum has failed its minimum threshold, volume accumulation shows a distributional pattern with falling on-balance volume, and the risk/reward at current levels is unfavorable — with downside exceeding the 5.7% upside to target — making the near-term setup unattractive even with fundamental value present. Momentum breakdown | Momentum recovers above the minimum threshold and on-balance volume turns positive for more than 30 consecutive trading days, signaling renewed accumulation. | →Stable |
| CounterThe stock trades above its 200-day moving average despite the weak momentum signal, meaning the longer-term price structure has not broken down; a value-oriented catalyst such as a beat-and-raise earnings report could quickly shift the technical picture. | ||
Three of the last four quarters produced beats — most recently by 7.9%, preceded by one in-line print, then two beats of 18.8% and 15.8% — with an average quarterly surprise of roughly 10.7% and no outright misses, suggesting a consistent pattern of delivering at or above market expectations. Earnings | Earnings surprise stays above 5% for the next two consecutive quarters, maintaining the positive delivery trend. | →Stable |
| CounterThe most recent in-line result breaks the prior beat streak; with customer concentration high and momentum weak, the next earnings print carries meaningful downside risk if any major customer reduces orders. | ||
Free cash flow converts at 299% of reported net income, meaning the business generates nearly three times more cash than GAAP earnings suggest, supported by a Piotroski F-score of 7 out of 9 that signals broad financial health despite modest reported margins.
→StableQuality breakdown
- Expectation
- Free cash flow to net income ratio remains above 150% for the next four quarters, confirming durable cash generation above reported earnings.
CounterWith no identified competitive moat and weak gross margin characteristics, the strong cash conversion may reflect asset-light timing dynamics or low capital intensity in the near term; a structural deterioration in the product mix could quickly erode both reported margins and cash generation simultaneously.
At a forward price-to-earnings of 9.8 times and a price/earnings-to-growth ratio of 1.07, the stock screens as attractively valued relative to its earnings and growth trajectory — the bundle explicitly characterizes it as attractively valued.
→StableValuation breakdown
- Expectation
- Forward earnings per share expands enough to keep the forward price-to-earnings ratio below 12 times over the next 12 months, validating the low-multiple entry thesis.
CounterValuation multiples can remain compressed for extended periods when business quality is below average and momentum is in a confirmed downtrend; screens cheap is not the same as the catalyst that closes the gap exists.
The top 10 customers account for 56% of total revenue, meaning a significant portion of the business depends on a small set of relationships; loss or material reduction in orders from any major customer could produce a disproportionate impact on the revenue base.
→StableBear case
- Expectation
- Revenue from the top 10 customers falls below 45% of total revenue within 18 months, reflecting meaningful diversification of the customer base.
CounterIn the auto parts industry, deep integration with a small number of large vehicle manufacturers can reflect genuine switching costs and long-cycle program awards rather than fragile concentration; established relationships may be more durable than the concentration percentage implies.
Price momentum has failed its minimum threshold, volume accumulation shows a distributional pattern with falling on-balance volume, and the risk/reward at current levels is unfavorable — with downside exceeding the 5.7% upside to target — making the near-term setup unattractive even with fundamental value present.
→StableMomentum breakdown
- Expectation
- Momentum recovers above the minimum threshold and on-balance volume turns positive for more than 30 consecutive trading days, signaling renewed accumulation.
CounterThe stock trades above its 200-day moving average despite the weak momentum signal, meaning the longer-term price structure has not broken down; a value-oriented catalyst such as a beat-and-raise earnings report could quickly shift the technical picture.
Three of the last four quarters produced beats — most recently by 7.9%, preceded by one in-line print, then two beats of 18.8% and 15.8% — with an average quarterly surprise of roughly 10.7% and no outright misses, suggesting a consistent pattern of delivering at or above market expectations.
→StableEarnings
- Expectation
- Earnings surprise stays above 5% for the next two consecutive quarters, maintaining the positive delivery trend.
CounterThe most recent in-line result breaks the prior beat streak; with customer concentration high and momentum weak, the next earnings print carries meaningful downside risk if any major customer reduces orders.
TrendMatrix Research · core thesis
Engine thesis — one sentence
An attractive forward multiple near 10 times earnings and free cash flow converting at nearly 3 times reported net income provide a fundamental floor for patient value buyers, but failed momentum, 56% customer concentration, and an unfavorable risk/reward at the current price — with downside exceeding upside — argue for caution rather than new entry.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
4.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 1.4 |
| ROA | 3.8 |
| Gross margin | 0.0 |
| Op margin | 3.9 |
| Net margin | 0.9 |
| Current ratio | 7.3 |
| FCF quality | 10.0 |
| Moat | 4.2 |
| Piotroski F | 7.8 |
- ▸Excellent cash conversion: 299% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 7/9
Growth
3.8/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 3.8 |
Momentum
1.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.0 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 1.5 |
| Volume | 1.2 |
- ▸Capitulation risk (RSI 25, below 200MA)
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope flat
Sentiment
8.0/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 8.9 |
| Price target | 8.7 |
| erm sentiment | 5.7 |
- ▸Analyst upside: 32%
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸Negligible insider selling — $13,247 (0.000% of mkt cap)
Peer rank
3.0/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.3 |
| quality rank | 3.7 |
| growth rank | 4.0 |
Technical
7.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.4 |
| support resistance | 9.5 |
| 52w position | 5.0 |
| gap | 5.0 |
Risk (lower is worse)
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.9 |
| days to cover | 8.5 |
| volatility | 1.9 |
| put call | 10.0 |
| implied vol | 3.2 |
| beta | 5.6 |
| debt equity | 4.9 |
- ▸High IV: 61%
- ▸Concentration risks: 1 HIGH, 2 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 6.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 7.8 |
- ▸Strong earnings: 3B/0M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- ASYMMETRY:2.2>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:27d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:1.3<4.5
- DEATH_CROSS:HARD_BLOCK
Warning (0)
none
Reward-to-Risk
2.18
Upside
+18.6%
Downside
8.5%
Sizing output
AVOID
SetupFalling Knife — Death cross, below all MAs, RSI 25, MACD bearish
EdgeCatalyst-Driven — Earnings in 27d with 3/4 beat streak
SuitabilityAggressive — Beta 1.34>1.3
Investment implication
The F-path SELL output reflects an overall score of 4.6 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Sentiment at 8.0) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:1.3<4.5, DEATH_CROSS:HARD_BLOCK) reinforce the read. Current asymmetry R:R is 2.18 — supplementary context, not the trigger for this path.
The strongest dimensions are Sentiment at 8.0, Value at 7.8, and Catalyst at 7.2; the weakest are Momentum at 1.3, Peer rank at 3.0, and Growth at 3.8. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of 2.18 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Attractive Forward Valuation
Trip ifForward price-to-earnings ratio rises above 16 times, indicating the stock no longer screens as attractively valued on forward earnings.
- P2Exceptional Fcf Conversion
Trip ifFree cash flow to net income ratio falls below 100% for 2 consecutive quarters.
- P3High Customer Concentration Risk
Trip ifRevenue from the top 10 customers falls below 45% of total revenue for 2 consecutive quarters, reflecting meaningful customer diversification.
- P4Negative Momentum Volume Distribution
Trip ifPrice momentum score rises above 4.5 and on-balance volume turns positive for more than 30 consecutive trading days.
- P5Earnings Delivery Track Record
Trip ifEPS surprise falls below 0% for 2 consecutive quarters, breaking the no-miss delivery track record.