Value
8.3/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 6.6 |
| P/S | 9.9 |
| EV/EBITDA | 8.0 |
| Fwd P/E | 9.3 |
| PEG | 10.0 |
| Analyst target | 6.0 |
- ▸Forward P/E: 9.6x
- ▸PEG: 0.09
- ▸Attractively valued
VC · Why this verdict
Why Visteon (VC) 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 score5.6/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Visteon trades at a modest forward multiple of 12x with a strong Piotroski score and exceptional free cash flow conversion, but negative price momentum and negative risk/reward asymmetry make the current setup unfavorable until technicals improve.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Visteon converts net income to free cash flow at 144%, a level that indicates the reported earnings are backed by real cash generation rather than accounting accruals, supporting balance sheet resilience despite auto-supplier cyclicality. Quality breakdown | Free cash flow yield remains above 8% and FCF-to-net-income ratio stays above 100% over the next 12 months. | →Stable |
| CounterAuto supplier free cash flow is highly sensitive to OEM production schedules and semiconductor chip sourcing costs, both of which Visteon has flagged as concentration risks; a demand cut from a major customer could rapidly compress FCF. | ||
With a PEG ratio of 0.19 and a forward price-to-earnings of 12x, Visteon's growth is priced cheaply relative to peers, suggesting the stock embeds limited optimism about its digital cockpit product cycle. Valuation breakdown | Forward P/E remains below 15x and PEG ratio stays below 0.5 as earnings estimates hold or rise over the next four quarters. | Tripped→Stable |
| CounterThe analyst price target has already been reached, leaving negative upside of roughly 9.5%, which means the cheap valuation may reflect the market correctly pricing in near-term execution risk rather than offering a genuine discount. | ||
Visteon's identified high-severity supplier concentration in semiconductor chips creates a single-source dependency that, if disrupted, could impair revenue across multiple vehicle programs simultaneously. Bear case | No earnings guidance revision attributable to chip supply shortfalls in the next two quarters, and the bear case concentration flag is not escalated in subsequent 10-K filings. | ↓Deteriorating |
| CounterThe auto industry has broadly rebuilt chip inventory buffers since 2022, and Visteon's cockpit electronics products command premium margins that give OEM customers an incentive to protect supply; a disruption may be less severe than historical precedent. | ||
Visteon's momentum score of 3.3 out of 10, driven by falling on-balance volume and a flat 200-day moving average slope, indicates that institutional buying pressure has not returned despite the low valuation, limiting near-term price catalysts. Scores | On-balance volume trends positive and the RSI rises above 55 within the next two quarters, indicating renewed buying interest. | — |
| CounterLow-momentum setups in value stocks sometimes resolve sharply upward when a catalyst (earnings beat, sector rotation) appears; the current range-bound behavior may simply precede a breakout rather than signaling further decline. | ||
Visteon converts net income to free cash flow at 144%, a level that indicates the reported earnings are backed by real cash generation rather than accounting accruals, supporting balance sheet resilience despite auto-supplier cyclicality.
→StableQuality breakdown
- Expectation
- Free cash flow yield remains above 8% and FCF-to-net-income ratio stays above 100% over the next 12 months.
CounterAuto supplier free cash flow is highly sensitive to OEM production schedules and semiconductor chip sourcing costs, both of which Visteon has flagged as concentration risks; a demand cut from a major customer could rapidly compress FCF.
With a PEG ratio of 0.19 and a forward price-to-earnings of 12x, Visteon's growth is priced cheaply relative to peers, suggesting the stock embeds limited optimism about its digital cockpit product cycle.
Tripped→StableValuation breakdown
- Expectation
- Forward P/E remains below 15x and PEG ratio stays below 0.5 as earnings estimates hold or rise over the next four quarters.
CounterThe analyst price target has already been reached, leaving negative upside of roughly 9.5%, which means the cheap valuation may reflect the market correctly pricing in near-term execution risk rather than offering a genuine discount.
Visteon's identified high-severity supplier concentration in semiconductor chips creates a single-source dependency that, if disrupted, could impair revenue across multiple vehicle programs simultaneously.
↓DeterioratingBear case
- Expectation
- No earnings guidance revision attributable to chip supply shortfalls in the next two quarters, and the bear case concentration flag is not escalated in subsequent 10-K filings.
CounterThe auto industry has broadly rebuilt chip inventory buffers since 2022, and Visteon's cockpit electronics products command premium margins that give OEM customers an incentive to protect supply; a disruption may be less severe than historical precedent.
Visteon's momentum score of 3.3 out of 10, driven by falling on-balance volume and a flat 200-day moving average slope, indicates that institutional buying pressure has not returned despite the low valuation, limiting near-term price catalysts.
—Scores
- Expectation
- On-balance volume trends positive and the RSI rises above 55 within the next two quarters, indicating renewed buying interest.
CounterLow-momentum setups in value stocks sometimes resolve sharply upward when a catalyst (earnings beat, sector rotation) appears; the current range-bound behavior may simply precede a breakout rather than signaling further decline.
Per-dimension breakdown
Quality
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.2 |
| ROA | 3.6 |
| Gross margin | 0.0 |
| Op margin | 3.1 |
| Net margin | 1.9 |
| Current ratio | 6.3 |
| FCF quality | 9.7 |
| Moat | 4.6 |
| Piotroski F | 7.8 |
- ▸Excellent cash conversion: 142% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 7/9
Growth
6.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 2.3 |
| EPS growth | 10.0 |
- ▸Declining revenue: -1%
Momentum
2.5/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.5 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 2.0 |
| Volume | 5.9 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA (recent, shallow — too early to call)
Sentiment
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 8.6 |
| erm sentiment | 5.0 |
- ▸Analyst upside: 31%
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| holder change | 5.5 |
- ▸Modest insider selling — $600,000 (0.022% of mkt cap)
Peer rank
4.7/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.3 |
| quality rank | 5.7 |
| growth rank | 0.9 |
Technical
7.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.8 |
| support resistance | 8.9 |
| 52w position | 5.8 |
Risk (lower is worse)
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 3.1 |
| days to cover | 3.4 |
| volatility | 6.1 |
| put call | 5.6 |
| implied vol | 5.6 |
| max pain risk | 7.0 |
| beta | 5.7 |
| debt equity | 9.0 |
- ▸Concentration risks: 1 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 1.1 |
| earnings timing | 5.0 |
| surprise avg | 4.8 |
| dividend safety | 7.5 |
- ▸Earnings concerns: 1B/2M
- ▸Dividend aristocrat: 1.5% yield
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- ASYMMETRY:2.7>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:49d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- MOMENTUM:2.5<4.5
Warning (0)
none
Reward-to-Risk
2.67
Upside
+13.7%
Downside
5.1%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 1.31>1.3, MCap $2.7B<$5B
Investment implication
The F-path SELL output reflects an overall score of 5.6 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 8.3) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:2.5<4.5) reinforce the read. Current asymmetry R:R is 2.67 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 8.3, Technical at 7.8, and Growth at 6.2; the weakest are Momentum at 2.5, Quality at 4.5, and Catalyst at 4.7. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of 2.67 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Fcf Conversion Strength
Trip ifFree cash flow to net income ratio falls below 80% for 2 consecutive quarters, indicating earnings quality has deteriorated.
- P2Value Peg AttractivenessTripped
Trip ifForward P/E rises above 18x following downward earnings revisions, eliminating the valuation discount.
- P3Semiconductor Concentration Risk
Trip ifRevenue guidance is cut by more than 5% in at least 1 quarter due to chip supply disruption.
- P4Momentum Technical Headwind
Trip ifMomentum score remains below 4.0 for more than 3 consecutive months with RSI staying below 45.