BofA Double Upgrades Forvia to Buy, Lifts Price Objective to €14

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Bank of America double upgraded Forvia to Buy from Underperform and raised its price objective to €14 from €10.50, sending shares of the French auto parts supplier up more than 8% Wednesday. Analyst Stephen Benhamou said the concerns raised at the bank's initiation "now appear largely priced in." The upgrade followed Forvia's announcement a day earlier of a seating joint venture with India's Anand Group, in which Forvia will hold 50% plus one share and Gabriel India, Anand's flagship listed company, will hold 50% less one share; the venture aims to help Forvia reach about 10% market share in India over five years. Benhamou noted Forvia is the worst-performing European supplier this year, down about 30%, trading at a roughly 10% discount to peers with a free cash flow yield above 20%. He said the planned €1.82 billion sale of the Interiors business exposes a valuation gap, with the remaining business trading at 6.4 times 2027 estimated EV/EBIT versus 7.2 times for European suppliers, and that convergence with peers would imply about 60% upside. BofA expects savings of about €110 million in 2026 and €120 million in 2027 to lift the adjusted EBIT margin to 7.0% by 2028 from 6.2% in 2026, while leverage falls to 1.2 times from 1.6 times, with its 2028 estimates about 5% above consensus.

Impact on assets 3

Consumer Discretionary▲
Forvia SE
FRVIA
▲ PositiveCapitalrelevance

BofA double upgraded Forvia to Buy and lifted its price objective to €14 from €10.50.

Financials▲
Artificial Intelligence▲

Off-coverage companies 2

Anand Groupi
Private▲ PositiveDemandrelevance

Forvia announced a seating joint venture with India's Anand Group, with Gabriel India holding 50% less one share.

Gabriel India Limitedi
Private▲ PositiveDemandrelevance

Gabriel India, Anand's flagship listed company, will hold 50% less one share in the new Forvia seating joint venture.