Company Overview
Garrett Motion Inc. operates within the Consumer Cyclical sector as a specialized manufacturer of engineered turbocharging and high-speed electric motor technologies, serving original equipment manufacturers, distributors, and industrial fields across the United States, Europe, Asia, and international markets. The company's core business involves designing and selling these critical automotive and industrial components to support vehicle performance and efficiency standards globally. In terms of scale, the entity holds a market capitalization of $3.45B and generates annual revenue of $3.58B while employing a workforce of 6300 individuals. These financial dimensions indicate that Garrett Motion functions as a mid-sized enterprise with significant operational reach, yet its market cap relative to its revenue suggests a valuation that does not fully reflect the total breadth of its global supply chain operations.
Financial Health
The company reports trailing twelve-month revenue of $3.58B, net income of $310.00M, and EBITDA of $605.00M, illustrating a substantial gap between total revenue and final profitability that reveals a robust cost structure requiring significant operational expenses to reach the bottom line. This gap between the $3.58B revenue and $310.00M net income results in a profit margin of 8.6%, while the operating margin sits at 14.1% and the gross margin stands at 20.4%, indicating that the company retains roughly one-fifth of sales revenue after direct production costs but faces substantial overhead pressures that reduce operating income further. Garrett Motion maintains free cash flow of $318.75M, which provides a clear measure of financial flexibility allowing the firm to fund capital expenditures or manage working capital without relying solely on external financing. On the balance sheet, the company holds cash reserves of $177.00M against total debt of $1.47B, resulting in a debt-to-equity ratio that is listed as N/A, suggesting a capital structure heavily weighted toward liabilities relative to equity. The current ratio of 0.97 indicates that short-term assets are slightly below short-term liabilities, signaling a tight liquidity position where current obligations exceed current resources. Return on Equity is listed as N/A, while Return on Assets stands at 13.6%, a metric that reveals management's effectiveness in utilizing the asset base to generate earnings before interest and taxes.
Valuation Assessment
The stock carries a trailing P/E ratio of 11.68 and a forward P/E of 8.46, implying that the market expects earnings to grow significantly in the future to justify the lower forward multiple compared to the historical trailing average. The price-to-book ratio is recorded as -4.22, a negative figure that indicates the market values the company well below its book value, potentially reflecting legacy liabilities or specific accounting adjustments that depress the equity valuation. Alternative valuation metrics such as the price-to-sales ratio of 0.96 and the EV/EBITDA of 7.71 suggest the company trades at less than one dollar of market value per dollar of sales, positioning it as a value-oriented play relative to revenue generation. Regarding trading range, the 52-week high is $21.43 and the 52-week low is $7.01, meaning the current market price sits at a specific point within this wide volatility band, though the exact current price is not provided to calculate the precise percentage deviation. The beta value of 0.38 indicates that the stock price exhibits significantly lower volatility than the broader market, moving less than half as much in response to general market fluctuations.
Growth & Income
Revenue growth for the trailing twelve months is 5.6%, whereas earnings growth is -9.8%, demonstrating that earnings are currently declining faster than revenue, which implies that operating leverage or margin compression is negatively impacting bottom-line performance despite top-line expansion. As a dividend payer, the company offers a dividend yield of 1.8% with a payout ratio of 17.1%, a conservative level that suggests the dividend is highly sustainable given that less than 20% of net income is distributed to shareholders. The low payout ratio leaves ample room for the company to retain earnings for reinvestment, capital allocation, or debt reduction while maintaining a steady income stream for investors. Overall, the growth and income profile presents a mixed picture of modest revenue expansion offset by earnings contraction, supported by a low-cost-of-capital structure and a stable, low-volatility beta that provides downside protection for income-focused portfolios.