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AXL – Market expectations are for fading Uniform ROA, but management is confident about their margins, sales, and costs

October 27, 2019

  • American Axle & Manufacturing Holdings, Inc. (AXL:USA) currently trades below corporate averages relative to UAFRS-based (Uniform) Earnings, with a 11.9x Uniform P/E, implying bearish expectations for the firm. However, management is confident about their margins, sales, and cost management efforts
  • Specifically, management is confident that their metal forming business unit performed at over 18% EBITDA margins in Q2 and that their launch performance improvement initiative is driving higher sales. Furthermore, they are confident that they are working to produce lower project expenses in 2020 and that they can offset EBITDA declines by reducing their capex spend.

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