Market Overview

Strategic Action At Visteon Is Unlikely, Morgan Stanley Says In Double Downgrade

Strategic Action At Visteon Is Unlikely, Morgan Stanley Says In Double Downgrade

Shares of auto supplier Visteon Corp (NASDAQ: VC) were hit with a double downgrade from Morgan Stanley Thursday. The stock was down more than 4 percent at the close Friday. 

The Analyst

Morgan Stanley downgraded Visteon from Overweight to Underweight and lowered the price target from $123 to $110.

The Thesis

Morgan Stanley's pessimistic expectations for Visteon are due to a less constructive view on the value of instrument and infotainment centers in vehicle architectures, according to the firm's report. 

Strategic action is unlikely in the near-term, given Visteon's consistent pattern of insider selling and low insider ownership.

Morgan Stanley is not projecting the same back-end-loaded growth that Visteon has implied for 2021.  

Like Harman, which was acquired by SAMSUNG ELECTRONIC (OTC: SSNNF) in March 2017, Visteon could be an acquisition candidate for a buyer looking to access strong relationships with auto manufacturers, according to Morgan Stanley.

The sell-side firm's reduced $110 price target is based on 8.5 times 2019 EV/EBITDA, down from an earlier multiple of 9.5 times.

Visteon does have upside risks if the company secures strong business wins, if the auto supplier gives investors confidence in the achievability of its 2021 guidance or if the company is acquired, according to Morgan Stanley. 

The Price Action

Visteon shares are up over 19 percent over the past year.

The stock ended Friday's session down 4.13 percent at $108.76 after losing more than 6 percent the prior day. 

Related Links:

Which Is A Better Investment: Automakers, Auto Suppliers Or Car Parts/Service Providers?

Delphi's Spinoff Upside Already Priced In?

Photo courtesy of Visteon. 

Latest Ratings for VC

Jul 2019MaintainsNeutral
Jul 2019MaintainsOutperform
Apr 2019UpgradesUnderperformHold

View More Analyst Ratings for VC
View the Latest Analyst Ratings

Posted-In: Auto Suppliers Morgan StanleyAnalyst Color Downgrades Price Target Analyst Ratings Best of Benzinga


Related Articles (VC + SSNNF)

View Comments and Join the Discussion!

Latest Ratings

WUBABOCOM InternationalDowngrades
DLTROTR GlobalUpgrades
ARCCCompass PointDowngrades
GTYHCitiInitiates Coverage On7.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Trading Daily
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at

Analysts Bullish On Red Hat Ahead Of Q4 Earnings

Pot Stocks, ETFs, Top News And Data From The Cannabis Industry This Week