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Aptiv (APTV) Reinforces Cash Position Amid Coronavirus Crisis

Zacks Equity Research

Aptiv PLC APTV on Monday announced steps to brace itself up for the coronavirus-led economic uncertainty and the impact of the pandemic on the global automotive industry.

The company is drawing down all remaining amounts, roughly $1.4 billion, on its Revolving Credit Facility to improve its financial flexibility and liquidity. With these additional funds, Aptiv will have around $1.7 billion of cash on hand and $2.0 billion outstanding under the existing revolver facility.

Moreover, the company secured capital by suspending annual dividend of around $225 million. As its customer plants are closed down and vehicle production schedules changed, Aptiv has ramped down several production facilities as a cost control and working capital management measure.

Aptiv PLC Cash from Operations (TTM)

Aptiv PLC Cash from Operations (TTM)

Aptiv PLC cash-from-operations-ttm | Aptiv PLC Quote

Kevin Clark, president and CEO at Aptiv stated, "The long-term health and well-being of our employees and their families, our customers, and the broader communities where we operate is our primary concern, and we have implemented robust measures in each of our facilities to keep our employees safe."

We observe that Aptiv shares have decreased 35.9% over the past year, compared with 35.8% decline of the industry it belongs to and 18.8% fall of the Zacks S&P 500 composite.

Zacks Rank and Stocks to Consider

Currently, Aptiv has a Zacks Rank #5 (Strong Sell).

Some better-ranked stocks in the broader Zacks Business Services sector are Sykes Enterprises SYKE, Omnicom OMC and Genpact G, each carrying a Zacks Rank #2 (Buy).

Long-term expected EPS (three to five years) growth rate for Sykes, Omnicom and Genpact is 10%, 5.6% and 14%, respectively. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Aptiv PLC (APTV) : Free Stock Analysis Report
 
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