Investing.com –Bank of America cut its ratings on auto suppliers BorgWarner and Lear to Neutral, saying weak production trends and limited scope for valuation gains leave little room for the stocks to climb further.
Analysts lowered the price target to $46 from $41 on BorgWarner. While new contract wins will aid growth, benefits will not materialize until 2027 or later.
“BWA benefitted from multiple expansion in 2025 and it’s approaching its historical median range (5.8x). We see further multiple expansion as challenging given our topline growth expectations,” analysts wrote.
On Lear, the brokerage said, “The lack of support from auto production is a hurdle for LEA to deliver growth and margin expansion, which are key to re-rate higher.”
It cut its price target to $123 from $135 and warned that despite trading below its historical average, the stock’s upside potential is capped.
Whereas Bank of America reaffirmed Buy ratings on Visteon and Aptiv given their stronger fundamentals and growth drivers.
“We reiterate our Buy rating on Visteon due to operating result resiliency, robust FCF margin (~6%+), exposure to high growth componentry, and customer portfolio expansion.”
The firm raised its price target on Visteon to $140 from $125.
For Aptiv, analysts highlighted catalysts including a November investor day and the planned spinoff of its electrical distribution systems unit in early 2026.
“We continue to view APTV positively given operating result resiliency, exposure to secular trends (ADAS), and diversification into non-auto end markets,” they wrote, lifting the price target to $95 from $85.
The brokerage maintained a neutral stance on Mobileye, lowering its price target to $16, while reiterating a buy on Phinia and underperform on Adient.
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