Aptiv APTV
Consumer Cyclical · Auto - Parts · Synthos Deep Dive · 2026-07-03
The Overview
Aptiv makes the "nervous system" of modern cars — the wiring, connectors, sensors, safety computers and software that let a vehicle sense, think and act. In April 2026 it split in two: it spun off its biggest, most stable division (the wiring-harness business, now a separate company called Versigent) and kept the higher-tech "brains and safety" pieces. What's left is a smaller company that is more profitable per dollar of sales but also more exposed to the ups and downs of how many cars the world builds.
Is the stock cheap or expensive? On the numbers, cheap — you're paying about $10 for every $1 of yearly profit, roughly half what the average stock costs. But cheap stocks are often cheap for a reason: the share price has fallen about a third from its 12-month high and is near multi-year lows, the company carries a meaningful debt load, and car demand can sag in a recession.
Our verdict is Watch — interesting, possibly a bargain, but not a "buy now." We want to see one or two clean quarters as the new, slimmed-down company before believing the turnaround.
Here's what the three scores mean in everyday terms:
- Downside Risk 6/10 (a bit riskier than average). The low price is a cushion, but debt, a jumpy stock, and dependence on the car cycle mean it can fall hard in bad times.
- Growth Quality 4/10 (below average). It grows slowly, earns only modest returns on the money it invests, and sells parts that competitors can also make.
- Exponential Potential 3/10 (low). There's a real long-term story in self-driving and smarter cars, but it moves slowly and this is a mid-sized, cyclical parts maker — not a rocket ship.
The one big worry: if global car production slips, a company with this much debt and this much cyclicality gets hit harder than average.
Putting a number on it: our fair-value estimate is $62 against a current price of $45.75 — real upside if our numbers are right.
Our summary metrics
Cheap on FCF (~10× fwd EPS, EV/EBITDA 8.6×) but 2.85× net-debt/EBITDA, beta 1.33, -67% max drawdown & deep cyclicality.
Post-spin "New Aptiv" grows low-single-digits above a soft auto-production market; margins expanding but ROIC ~2.7% and moat is commoditized wiring/electronics.
Software-defined-vehicle & active-safety optionality is real but slow; a $12B cyclical supplier tied to auto builds is not an exponential.
What does “fair value” mean?
Fair value is Synthos’s estimate of what one share is worth today, based on our model of the company’s future cash generation and the risks to it. It is not a price target or a prediction of where the stock trades next quarter — it’s the price where we think risk and reward are balanced. Above it, you’re paying for outcomes better than our base case; below it, the market is offering a margin of safety.
The model’s inputs and weightings are proprietary — they’re the product. What we publish is the output, plus an independent, public-math cross-check further down the page (“Check our number”) so you can judge it for yourself.
What do the 5 tiers mean? (Core · Tactical · Watch · Hold · Avoid)
Exponential Potential
Software-defined-vehicle & active-safety optionality is real but slow; a $12B cyclical supplier tied to auto builds is not an exponential.
What could take this further than the base case — and where the market may be underpricing it. Full forward-growth and acceleration math in Deeper analysis, §4 below.
Deeper analysis
Technicals, fundamentals, valuation, and the full expert-claim evidence panel — the detail behind the numbers above.
Reference table
| Street consensus | $88.63 (high $110 / low $71; 20 Buy · 13 Hold · 0 Sell) — STALE, pre-spinoff; not our anchor (see §6) |
| Valuation | ~10× FY26E adj. EPS · EV/EBITDA 8.6× · EV/Sales 0.9× · P/B 1.4× · FCF yield ~8.8% |
| Technicals | Downtrend — $58.89, −33.6% off 52-wk high, below 50/200-DMA, RSI 25 (oversold), −18% 12-mo (SPY +21%) |
| Conviction | Low — 0 expert voices in the KB; call rests on fundamentals + quant |
| Position sizing | Deep-value/turnaround satellite only, ≤1–2%, if at all |
What the experts actually said
No independent expert claims in the Synthos knowledge base yet for APTV — this dive is fundamentals- and technicals-driven, not panel-driven.
Price & moving averages 12 months · 50 & 200-day averages · 52-week range
Solid line = price · dashed line = 50-day average · dotted line = 200-day average · the two thin horizontal lines mark the 52-week high and low. Price above both averages is an uptrend.
Data summary: last close $45.75, 17% below the 50-day average ($55), 31% below the 200-day average ($66) — a downtrend. 48% below the 52-week high of $89, 1% above the 52-week low of $45.
Bollinger Bands 20-day average ± 2 standard deviations
The shaded band widens when the stock gets more volatile. Riding the upper edge = strong momentum (sometimes stretched); the lower edge = weak / potentially oversold.
Data summary: price $45.75 is currently inside the band (band $44–$53).
RSI (14) momentum gauge · 0–100
Above 70 (overbought zone, shaded) = overbought, below 30 (oversold zone, shaded) = oversold. Currently 33.
MACD 12 / 26 / 9 · trend & momentum
The MACD line crossing above the signal line (bars flip to the up color) = momentum turning up; crossing below (bars flip to the down color) = turning down. Bar height = the size of that gap.
Data summary: MACD is currently above its signal line by 0.01, positive momentum.
Relative performance vs S&P 500 & its sector (XLY (sector)), set to 100 a year ago
Solid = APTV · dashed = S&P 500 · dotted = XLY (sector). A rising line means it is beating that benchmark — the sector line shows whether it is a leader or laggard within its own group.
Forward revenue & earnings actual → estimate · "FY" = fiscal year, "E" = estimate
Darker bars = actual results, brighter = analyst estimates. Taller bars to the right = expected growth.
Key stats an RIA wants
1. What it is
Aptiv PLC (NYSE: APTV) is a global automotive technology supplier headquartered in Schaffhausen, Switzerland, incorporated in 2011 (the former Delphi "brain and nervous system" spin). It sells hardware and software that let vehicles sense, think, act and optimize — active-safety sensors, compute platforms, software, connectors, and (until April 2026) the electrical distribution / wiring-harness systems that physically move power and data around a car. CEO Kevin Clark. ~144,000 employees. Fiscal year ends December 31.
The pivotal event: on April 1, 2026, Aptiv completed the spin-off of its Electrical Distribution Systems (EDS) business into a new public company, Versigent. EDS was the largest segment (~$8.8B of FY25 revenue). Beginning Q2'26, EDS is treated as a discontinued operation, so the trailing FY25 income statement (revenue $20.4B) overstates the go-forward company. "New Aptiv" is roughly a $13B-revenue business built on two segments:
- Intelligent Systems (formerly Advanced Safety & User Experience) — active safety, user experience, smart-vehicle compute and software. ~$5.8B FY25.
- Engineered Components (formerly Engineered Components Group) — connection systems, interconnects, cable management. ~$6.7B FY25.
Revenue mix — segment (FY2025, from filings, pre-spin):
- Electrical Distribution Systems $8.82B (43%) → spun off April 2026
- Engineered Components Group $6.66B (33%)
- Advanced Safety & User Experience $5.79B (28%)
Revenue mix — geography (FY2025, from filings): United States $7.36B · EMEA $6.57B · Asia Pacific $5.87B (China exposure within) · Germany $1.64B · South America $0.39B. Genuinely global, EMEA- and Asia-heavy — a strength for diversification, a weakness given soft European auto production (EMEA revenue fell 7% in Q1'26).
2. The expert thesis (traceable)
There is no expert coverage for APTV in the Synthos knowledge base. total_claims = 0, net_bullish_voices = 0, top = []. No distilled voice — bullish or bearish — has APTV in the panel.
That is itself a signal: Aptiv is not a name the high-skill managers Synthos tracks are talking about. The verdict here is entirely fundamentals- and quant-driven, and is graded accordingly (Low conviction). We do not manufacture a thesis where the KB has none. Everything below is built from the FMP financials, the SEC 8-K earnings release, and standard valuation work — not from expert conviction.
3. Synthos scores & the Bull / Base / Bear cases
The one-glance judgment — three scores, 0–10, each anchored to real metrics (not probabilities we can't honestly calibrate):
| Score | 0–10 | The read |
|---|---|---|
| Downside Risk (lower = safer) | 6 · Elevated | Statistically cheap (~10× fwd EPS, 8.6× EV/EBITDA, ~8.8% FCF yield) — but net-debt/EBITDA 2.85×, beta 1.33, a −67% max drawdown, RSI 25, and deep auto-cyclicality. The cheapness offsets, but does not erase, the leverage-plus-cycle risk. |
| Growth Quality | 4 · Below-average | Post-spin "New Aptiv" guides to ~$13B revenue growing low-single-digits over a soft auto market; adjusted EBITDA margin rising toward ~18.6%, but ROIC ~2.7%, ROE ~3.9% (GAAP, depressed by 2025 tax/impairment noise) and a commoditized-hardware core. Real self-help, modest quality. |
| Exponential Potential | 3 · Low | Software-defined-vehicle and active-safety content-per-vehicle growth is a genuine secular tailwind, but it compounds slowly, and the faster-growing dollar base (EDS) was just spun out. A leveraged, cyclical, $12B supplier tied to global car builds is structurally not an exponential. |
The three cases (our own scenario model — assumptions shown; each target is a ~12–18-month fair value). We deliberately do not attach probabilities; the cases bound the range and the scores summarize them. All EPS figures are New-Aptiv adjusted EPS (ex-EDS), consistent with management's post-spin guidance.
| Case | Key assumptions | Fair value |
|---|---|---|
| Bull | Auto production recovers; SDV/active-safety content-per-vehicle wins compound; New Aptiv hits the high end (FY26 adj. EPS ~$6.10, growing to ~$7.50 FY28E) and the market re-rates a cleaner, higher-margin business to ~13–14×. Buyback ($2.0B remaining authorization) shrinks the share count. | ~$88 (+49%) |
| Base (our anchor) | Guidance roughly holds — FY26 adj. EPS ~$5.90 (mgmt midpoint), low-single-digit growth to ~$6.50 FY28E; the stock earns a ~10–11× multiple appropriate to a cyclical supplier with 2.85× leverage. | ~$62 (+5%) |
| Bear | Global auto production rolls over; EMEA/China stay weak; margins give back the commodity/FX gains; a levered supplier de-rates to ~7× trough earnings (~$5.00). Leverage amplifies the equity hit. | ~$38 (−35%) |
Synthos fair value = the base case, ~$62 (+5%), with the full $38–$88 span as the honest range. We explicitly reject the Street's $88.63 consensus as an anchor — that target set (high $110, low $71) appears to be stale, struck before the EDS spin-off dilution to the go-forward earnings base (see §6). Our base sits far below it because we value New Aptiv on New Aptiv numbers. This is a tracked call, graded once it matures.
4. Exponential Potential
Synthos separates compounders (durable high returns on capital) from exponentials (accelerating multi-baggers-from-here). APTV is neither today — it is a cyclical value/turnaround:
- Forward growth: post-spin, management guides FY26 New-Aptiv revenue to $12.8–13.2B; consensus builds EPS from ~$6.17 (FY26E) toward ~$7.78 (FY28E) and ~$9.65 (FY30E) — a mid-to-high-single-digit EPS CAGR driven substantially by buybacks and margin, not unit volume.
- Acceleration (2nd derivative): negative to flat. The company's fastest-dollar-growth engine (EDS) was just removed. Underlying end-market — global vehicle production — is roughly flat-to-soft; Q1'26 organic revenue grew just 1% ex-FX/commodity, with EMEA −7% and China −2%. There is no volume inflection to ride.
- Room to run: at $12.5B market cap the name is small enough to move, and content-per-vehicle in active safety and compute is a real secular TAM. But the binding constraint is the auto cycle and a commoditized competitive set, not addressable market.
- Reinvestment runway: FCF is healthy (~$1.5B FY25, ~8.8% yield) but is being returned via buyback, not plowed into a high-return expansion — appropriate for the ROIC (~2.7%), but not the profile of an exponential.
Exponential Potential: Low (3/10). Own APTV, if at all, as a cheap cyclical with self-help optionality — not for exponential growth. A pure-play SDV story it is not.
5. Financials (real numbers — FMP annual/quarterly + SEC 8-K)
Important: FY25 and TTM figures below include EDS, which spun off April 1, 2026. Go-forward "New Aptiv" is ~$13B revenue — use the guidance in §9, not the trailing headline, for the forward company.
- Revenue: FY25 $20.40B (+3.5% vs FY24 $19.71B). Pre-spin, roughly flat-to-low-growth — a mature supplier tracking global auto builds.
- Margins (TTM, GAAP, distorted by 2025 one-offs): gross 19.1%, EBITDA 10.5%, operating 5.5%, net 1.8%. On an adjusted basis management runs a much cleaner ~15% EBITDA margin (Q1'26 adj. EBITDA margin 14.8%; New-Aptiv FY26 guide 18.6%).
- The 2025 noise: GAAP net income collapsed to $165M (EPS $0.75) from $1.79B (EPS $6.97) in FY24 — driven by a Q3'25 loss (−$355M) and heavy tax/valuation-allowance and separation charges tied to the spin. This is why trailing P/E (~35×) is meaningless here; use forward adjusted EPS (~$5.90 New Aptiv) → ~10× P/E.
- Cash flow: FY25 operating CF $2.19B, capex −$0.66B, FCF ~$1.53B (~8.8% FCF yield). Note the seasonal wrinkle: Q1'26 posted negative FCF (−$362M) and operating cash outflow — normal Q1 working-capital + spin costs, but watch it normalize.
- Balance sheet: total debt $8.09B, cash $1.85B, net debt $6.24B; net-debt/EBITDA ~2.85× (TTM). Current ratio 2.1×, interest coverage ~3.2×. Leverage is the single biggest fundamental caution. Post-spin, management used $1.85B of Versigent distribution proceeds to redeem senior notes in April 2026 — deleveraging is underway but the go-forward EBITDA base is also smaller.
6. Valuation — cheap, but cheap for reasons
On the surface APTV is statistically cheap: ~10× FY26E adjusted EPS, EV/EBITDA 8.6×, EV/Sales 0.9×, P/B 1.4×, and an ~8.8% free-cash-flow yield. That is roughly half the market multiple, and inexpensive even for the auto-supplier peer group.
But three things temper it:
1. Trailing multiples lie here. The ~35× trailing P/E reflects the 2025 GAAP earnings collapse (tax/impairment/spin charges), not economics. Anchor on forward adjusted EPS.
2. The Street consensus is stale. Consensus PT $88.63 (high $110, low $71) implies ~50% upside — but that target set does not appear to reflect the post-spin New Aptiv earnings base (management guides New-Aptiv FY26 adjusted EPS to just $5.70–6.10; $88 on ~$5.90 would be ~15×, a growth multiple this cyclical doesn't warrant). We treat the Street number as context to be discounted, not an anchor.
3. Cyclical + levered names deserve low multiples. A supplier at 2.85× net leverage tied to global vehicle production earns a single-digit-to-low-teens multiple across a cycle, not a re-rate to 15×.
Our base-case ~$62 = ~10.5× New-Aptiv adjusted EPS of ~$5.90. Cheap enough to watch; not cheap enough, against the leverage and cyclicality and with zero conviction support, to chase.
7. Technicals (from the tech block)
- Trend: down. $58.89 sits below the 50-DMA ($61.48) and well below the 200-DMA ($72.24); the 50 is below the 200 (death-cross posture).
- Location: −33.6% off the 52-week high ($88.67), only +12% off the 52-week low ($52.57), and a brutal −66.9% max drawdown from peak. This is a broken chart, not a base.
- Momentum: RSI(14) 25 — oversold (<30). MACD −0.94 (negative). Oversold can bounce, but it confirms the downtrend, not a reversal.
- Relative strength (the tell): APTV −17.8% 12-mo vs SPY +20.6% and QQQ +30.3%; −23% 6-mo vs SPY +8%. Persistent, heavy underperformance of both the market and the Nasdaq.
- Read: technicals are bearish and do not confirm a turn. Deeply oversold, so a tactical bounce is possible, but there is no evidence of accumulation. For a Watch name, wait for the chart to stop making lower lows (reclaim the 50-DMA) before acting.
8. Moat & competitive position
Aptiv's edge is engineering scale and design-win stickiness in vehicle electrical/electronic architecture and active safety — content that is specified years ahead and hard to swap mid-program. That confers real switching costs at the platform level. But the honest read is a narrow, contested moat: connectors, harnesses and even many active-safety components are supplied by a crowded field of capable competitors, returns on capital are low (ROIC ~2.7%), and the business is a price-taker to the automakers and to the global build cycle. The higher-value software-defined-vehicle and compute layer is where a durable moat could form — but that is aspirational, not yet reflected in returns.
Peer set (market cap): Magna International $17.1B, BorgWarner $13.0B, Allison Transmission $9.7B, Autoliv $8.7B, Lear $6.6B, LKQ $6.8B, Gentex $5.2B, Dorman $4.1B, Dana $3.1B, Visteon $2.7B, Adient $1.5B, American Axle $1.0B, Fox Factory $0.7B, Stoneridge $0.2B. APTV is among the larger and more technology-weighted of the group, which supports a modest premium within the peer set — but the whole cohort trades at cyclical-supplier multiples for good reason.
9. Management, capital allocation & guidance
- Capital allocation: disciplined and shareholder-friendly at present — $2.0B remaining under a $5.0B buyback authorization; 1.0M shares repurchased for $75M in Q1'26; $266M of 2029 notes redeemed in Q1 and $1,847M of senior notes redeemed in April 2026 using Versigent spin proceeds. No dividend. The strategy is a portfolio simplification (spin EDS, focus on higher-margin intelligent systems + components) plus deleveraging and buybacks.
- Insider activity: mixed but not alarming — routine executive sales (EVP People Officer 3,000 sh @ $69.60 on 6/15; CLO 2,000 sh @ $78.30 on 6/3) alongside a small open-market director purchase (Hakan Agnevall bought 6,100 sh @ $57.73 on 5/8 — a modest insider buy near current levels, a mild positive) and routine director stock awards. No cluster of alarming discretionary selling.
- Management's own guidance (half-weighted — their book): From the SEC 8-K (Q1'26 earnings release, filed 2026-05-05), management's dated forward guidance for New Aptiv (ex-EDS) is:
- Q2 2026: net sales $3,200–3,400M; GAAP net income $140–180M; Adjusted EBITDA $555–605M (~17.6% margin); GAAP diluted EPS $0.65–0.85; Adjusted EPS $1.30–1.50.
- Full-year 2026 (pro forma, New Aptiv): net sales $12,800–13,200M; GAAP net income $830–910M; Adjusted EBITDA $2,360–2,480M (~18.6% margin); GAAP diluted EPS $3.85–4.25; Adjusted EPS $5.70–6.10; cash flow from operations $1,315–1,515M; free cash flow $650–850M; effective tax rate 18.5%.
- CEO Kevin Clark framed the spin as sharpening focus on "enabling devices and systems to sense, think, act and optimize across industries," with "strong free cash flow generation enabling incremental value creation." This is management's self-interested framing; we half-weight it. It is, however, specific, dated, and consistent with the ~$13B / ~18.6%-margin / ~$5.90-EPS New-Aptiv model we anchor to.
10. Catalysts & what to watch
- Next earnings: 2026-07-30 (Q2'26; Street EPS $1.41, revenue ~$3.3B) — the first clean "New Aptiv" print with EDS as a discontinued operation. The line that matters: does adjusted EBITDA margin actually land near the guided ~17.6%, and does organic revenue return to growth?
- Global auto production — the master variable; watch SAAR trends, EMEA and China builds (both negative in Q1'26).
- FCF normalization — Q1'26 was negative on seasonality + spin costs; the full-year $650–850M guide needs the back half to deliver.
- Deleveraging — net-debt/EBITDA trajectory on the smaller New-Aptiv EBITDA base; further note redemptions.
- Buyback pace — $2.0B authorization remaining is a meaningful ~16% of the float at these prices; execution supports EPS.
Thesis tripwires (what would flip the Watch): Toward Buy — two clean quarters at/above guided margins, organic growth turning positive, net leverage falling below ~2.5×, and the chart reclaiming the 200-DMA. Toward Avoid — auto-production rollover, margin guide-downs, or leverage rising on weak EBITDA.
11. Key risks
- Cyclicality (structural): revenue is levered to global vehicle production; a downturn hits volumes and fixed-cost absorption directly.
- Leverage: net-debt/EBITDA 2.85× on a now-smaller EBITDA base amplifies any equity move; beta 1.33.
- Post-spin execution / dis-synergies: the go-forward company is unproven as a standalone; the $20B trailing headline overstates it, and stranded costs or lost EDS scale could pressure margins.
- Commoditization / pricing: connectors and many components face capable competition and automaker pricing power; ROIC is low (~2.7%).
- Geographic softness: EMEA (−7% Q1'26) and China (−2%) are weak; FX and commodity swings hit reported margins.
- Technical/sentiment: broken chart (−67% max drawdown, below both moving averages, 12-mo lagging SPY by ~38 points) — the market is voting no, and there is no expert conviction to lean against that.
- No expert coverage: zero KB voices means no independent, high-skill validation of any bull case.
12. Verdict, position sizing & monitoring
Watch. Aptiv is a genuinely cheap (~10× forward adjusted EPS, 8.6× EV/EBITDA, ~8.8% FCF yield), simplifying auto-tech supplier with a clean balance-sheet plan (deleveraging + $2B buyback) and a plausible higher-margin future as "New Aptiv." But it is also a leveraged (2.85×), deeply cyclical, commoditized-core supplier with mediocre returns on capital, a broken chart, a stale Street target that overstates upside, and — critically — zero expert conviction in the Synthos KB. Cheapness earns it a look; the leverage, the cycle, the unproven post-spin numbers, and the absent conviction keep it out of the buy sleeve for now.
- Sizing: if owned at all, a deep-value/turnaround satellite, ≤1–2% — not a core holding. Better to wait for the 2026-07-30 print than to anticipate it.
- Monitoring: re-underwrite on the §10 tripwires; formal re-score at the first clean New-Aptiv quarter. Logged as a tracked Synthos call as of 2026-07-03 at $58.89.
- Single biggest risk: a global auto-production downturn against 2.85× leverage.
Provenance & disclosures
- Traceability: 0 KB claims, breadth 0 — there is no expert coverage for APTV in the Synthos knowledge base, and no
claim_idvalues are cited because none exist. This verdict is explicitly fundamentals- and quant-driven and graded Low conviction. Fabricated conviction is structurally impossible (claim-ID reconciliation) and none is asserted here. - Data as-of: fundamentals 2026-03-31 (Q1'26) · estimates & prices 2026-07-02/03 · SEC 8-K earnings release 2026-05-05. Forward figures are analyst consensus (FMP) or management guidance, labeled as estimates.
- Spin-off caveat: trailing FY25/TTM figures include the EDS business spun off as Versigent on 2026-04-01. The go-forward company is ~$13B revenue; use §9 guidance for the forward model.
- Management caveat: the §9 guidance is management's own, half-weighted by design.
- Street-target caveat: the $88.63 consensus appears stale relative to the post-spin earnings base and is treated as context, not our anchor.
- Not investment advice. Independent research, educational and informational only, never personalized. Hypothetical/forward figures are labeled; the only performance numbers Synthos will headline are the live, real-money Flagship's.
- Version: 2026-07-03. Prior versions available via the deep-dive version dropdown ("based on the info at the time").