Gentherm Incorporated (THRM) | Investment Case

1. Company Snapshot

1.a. Company Description

Gentherm Incorporated designs, develops, manufactures, and markets thermal management technologies.The company operates in two segments, Automotive and Medical.The Automotive segment offers climate comfort systems, which include seat heaters, blowers, and thermoelectric devices for variable temperature climate control seats and steering wheel heaters that are designed to provide thermal comfort to automobile passengers; integrated electronic components, such as electronic control units that utilize proprietary electronics technology and software; and other climate comfort systems, including neck conditioners and climate control system products for door panels, armrests, cupholders, and storage bins.

It also provides battery performance solutions comprising cell connecting devices and battery cable technologies used for various types of automotive batteries, as well as thermal management products for heating and cooling 12 volts, 48 volts, and high voltage batteries and battery modules; and automotive electronic and software systems, including electronic control units for climate comfort systems, as well as for memory seat modules and other devices.This segment serves light vehicle original equipment manufacturers and first tier suppliers, such as automotive seat manufacturers, as well as aftermarket seat distributors and installers.The Medical segment offers patient temperature management systems.

The company provides its products and services in the United States, Germany, Canada, China, Hungary, Japan, South Korea, Romania, Macedonia, Malta, Mexico, the United Kingdom, Ukraine, and Vietnam.The company was formerly known as Amerigon Incorporated and changed its name to Gentherm Incorporated in September 2012.Gentherm Incorporated was incorporated in 1991 and is headquartered in Northville, Michigan.

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1.b. Last Insights on THRM

Gentherm's recent performance was negatively impacted by weak Q4 2024 earnings and revenue, which missed estimates. The company's automotive segment struggled, with revenue declining 4.3%, while the Medical segment saw a 8.1% revenue increase, though it remains a small part of the business. Additionally, Gentherm's 2025 guidance was disappointing, contributing to the negative sentiment. The company's failure to meet expectations and provide a strong outlook has raised concerns about its future performance.

1.c. Company Highlights

Last Price	30.3
Change Percentage	0.66%
Open	30.14
Previous Close	30.1
Market Cap ( Millions)	929
Volume	268679
Year High	39.48
Year Low	25.47
M A 50	29.53
M A 200	33.84

FCF Yield	8.46%
Dividend Yield	0.00%
ROE	3.17%
Debt / Equity	38.16%
Net Debt / EBIDTA	74.04%
Price To Book	1.29
Price Earnings Ratio	40.86
Price To FCF	11.82
Price To sales	0.61
EV / EBITDA	7.9

2. Gentherm Q1 2026: Revenue Surges, EBITDA Stays Robust, EPS Exceeds Expectations

Gentherm’s first‑quarter revenue climbed 11.3% YoY to $394 million, while adjusted EBITDA held steady at $49.3 million—12.5% of sales—reflecting disciplined cost control. EPS hit $0.84 versus analyst consensus of $0.53, a 58% beat that underscores the company’s pricing power amid rising freight and commodity costs.

Publication Date: Apr -27

                                    📋 Highlights
                                    Strong Q1 Outperformance:
                                                Revenue reached $394 million (+11.3% YoY), with adjusted EBITDA at 12.5% of sales.
New Business Awards:
                                                Secured $395 million in new automotive contracts and advanced organic growth initiatives.
Strategic Merger:
                                                Agreed to combine with Modine, creating a $3.5 billion revenue thermal solutions leader by 2026.
Cost Management Plan:
                                                $20 million incremental costs from geopolitical and commodity pressures, offset by $10 million annual savings from realignment.

                                

Revenue & Margin Analysis

Operating margins stayed near 12.5%, supported by an 11.3% revenue rise that outpaced the broader automotive segment’s 5‑point growth projection. The company’s diversified portfolio—ranging from automotive to medical and furniture—has cushioned it against cyclical downturns, as evidenced by a 14‑point Q1 lift over light‑vehicle production.

EPS Beat

The $0.84 EPS outperformed estimates by $0.31, driven by higher-than-expected automotive awards and the new ThermAffyx medical product. Management highlighted that the earnings surge aligns with the company’s strategic focus on high‑margin, high‑growth segments.

Strategic Partnerships & Growth

Gentherm secured $395 million in new automotive business awards and deepened its partnership with KUKA Home, positioning the firm to capture emerging smart‑home and EV market share. The anticipated $50‑$100 million furniture revenue by 2028 adds a steady, accretive margin stream.

M&A Impact

The announced merger with Modine Performance Technologies is projected to generate $3.5 billion in revenue and $0.5 billion in earnings over five years, creating a thermal and precision flow market leader. The deal is slated to close later this year, potentially boosting Gentherm’s valuation multiples.

Cost Management & Geopolitical Risks

Management flagged a $20 million incremental cost hit from freight and commodities, starting in Q2 and rolling through Q4. They plan to offset half of this through a $10 million annual run‑rate benefit from organizational realignment and price adjustments.

Future Outlook & Guidance

Gentherm maintains full‑year revenue guidance of $1.5‑$1.6 billion and adjusted EBITDA of $175‑$195 million, while acknowledging a 5‑point growth deceleration. The company expects ICE volumes to offset EV program suspensions, and anticipates modest growth in China and other regions.

Valuation Snapshot

3. NewsRoom

Gentherm Incorporated (THRM) Q1 2026 Earnings Call Transcript

Apr -23

Source: seekingalpha.com

Gentherm (THRM) Beats Q1 Earnings and Revenue Estimates

Apr -23

Source: zacks.com

How Will the Gentherm Deal Enhance Modine's Growth Prospects?

Apr -16

Source: zacks.com

JPMorgan Chase & Co. Lowers Stake in Gentherm Inc $THRM

Apr -07

Source: defenseworld.net

Gentherm Inc (NASDAQ:THRM) Receives $39.40 Consensus Price Target from Analysts

Apr -07

Source: defenseworld.net

Gentherm Inc $THRM Shares Acquired by Allspring Global Investments Holdings LLC

Apr -06

Source: defenseworld.net

SG Americas Securities LLC Has $2.04 Million Stock Position in Gentherm Inc $THRM

Apr -05

Source: defenseworld.net

Gentherm (NASDAQ:THRM) Stock Price Crosses Below Two Hundred Day Moving Average – Here’s What Happened

Mar -31

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.51%)

6. Segments

Automotive

Expected Growth: 6.5%

Gentherm's 6.5% growth in Automotive segment is driven by increasing demand for electric vehicles, rising adoption of advanced driver-assistance systems, and growing need for thermal management solutions. Additionally, the company's focus on innovative products, such as heated and cooled seats, and its partnerships with major OEMs contribute to its growth momentum.

Medical

Expected Growth: 6.8%

Gentherm's Medical segment growth of 6.8% is driven by increasing demand for temperature management solutions in medical devices, rising adoption of minimally invasive procedures, and growing need for patient temperature control during surgeries. Additionally, advancements in medical technology and expanding applications in emerging markets contribute to the segment's growth.

7. Detailed Products

Climate Control Seats (CCS)

Gentherm's Climate Control Seats (CCS) provide heating, ventilation, and cooling functions to enhance driver and passenger comfort.

Heated and Ventilated Seats (HVS)

Gentherm's Heated and Ventilated Seats (HVS) offer heating and cooling functions to enhance driver and passenger comfort.

Thermal Management Systems (TMS)

Gentherm's Thermal Management Systems (TMS) manage heat generation and dissipation in electric vehicles and hybrid electric vehicles.

Battery Thermal Management Systems (BTMS)

Gentherm's Battery Thermal Management Systems (BTMS) manage temperature in electric vehicle batteries to optimize performance and lifespan.

Cabin Comfort Systems (CCS)

Gentherm's Cabin Comfort Systems (CCS) provide heating, ventilation, and cooling functions to enhance passenger comfort in vehicles.

Medical Devices

Gentherm's Medical Devices provide thermal therapy solutions for pain relief, wound care, and physical therapy.

8. Gentherm Incorporated's Porter Forces

Forces Ranking

Threat Of Substitutes

Gentherm Incorporated faces moderate threat from substitutes, as there are limited alternatives to its thermal management solutions. However, the company's focus on innovation and technology advancements helps to mitigate this threat.

Bargaining Power Of Customers

Gentherm Incorporated has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's strong relationships with its customers and its ability to provide customized solutions further reduce the bargaining power of customers.

Bargaining Power Of Suppliers

Gentherm Incorporated has a moderate level of dependence on its suppliers, particularly for raw materials such as copper and aluminum. However, the company's diversified supply chain and long-term contracts with suppliers help to mitigate this risk.

Threat Of New Entrants

The thermal management solutions industry has high barriers to entry, including significant capital expenditures and technological expertise. This makes it difficult for new entrants to compete with established players like Gentherm Incorporated.

Intensity Of Rivalry

The thermal management solutions industry is highly competitive, with several established players competing for market share. Gentherm Incorporated faces intense competition from companies such as Mahle, Valeo, and BorgWarner, which can lead to pricing pressure and reduced margins.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	27.68%
Debt Cost	8.08%
Equity Weight	72.32%
Equity Cost	11.34%
WACC	10.44%
Leverage	38.27%

11. Quality Control: Gentherm Incorporated passed 4 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Inefficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

XPEL

A-Score: 4.7/10

Value: 2.4

Growth: 9.0

Quality: 7.8

Yield: 0.0

Momentum: 5.0

Volatility: 4.0

1-Year Total Return ->

Motorcar Parts of America

A-Score: 4.6/10

Value: 7.1

Growth: 4.8

Quality: 4.5

Yield: 0.0

Momentum: 9.5

Volatility: 2.0

1-Year Total Return ->

Gentherm

A-Score: 4.2/10

Value: 5.6

Growth: 5.0

Quality: 5.4

Yield: 0.0

Momentum: 3.5

Volatility: 5.7

1-Year Total Return ->

Cooper-Standard

A-Score: 4.2/10

Value: 7.2

Growth: 3.2

Quality: 3.5

Yield: 0.0

Momentum: 9.5

Volatility: 1.7

1-Year Total Return ->

Stoneridge

A-Score: 3.9/10

Value: 8.0

Growth: 4.3

Quality: 4.9

Yield: 0.0

Momentum: 3.5

Volatility: 2.7

1-Year Total Return ->

Fox Factory

A-Score: 3.6/10

Value: 9.3

Growth: 5.2

Quality: 3.8

Yield: 0.0

Momentum: 0.5

Volatility: 3.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

3.88%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

10.44%

Gentherm Incorporated - US37253A1034

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on THRM

1.c. Company Highlights

Fairly Valued

Average Yield

Stable Momentum

Earnings Beats

Expensive

Revenues Miss

Average Growth

Revenues Beats

Medium Volatility

Earnings Miss

Average Quality

Weak Momentum

2. Gentherm Q1 2026: Revenue Surges, EBITDA Stays Robust, EPS Exceeds Expectations

Revenue & Margin Analysis

EPS Beat

Strategic Partnerships & Growth

M&A Impact

Cost Management & Geopolitical Risks

Future Outlook & Guidance

Valuation Snapshot

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.51%)

6. Segments

Automotive

Expected Growth: 6.5%

Medical

Expected Growth: 6.8%

7. Detailed Products

Climate Control Seats (CCS)

Heated and Ventilated Seats (HVS)

Thermal Management Systems (TMS)

Battery Thermal Management Systems (BTMS)

Cabin Comfort Systems (CCS)

Medical Devices

8. Gentherm Incorporated's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Gentherm Incorporated passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

30.3$

Current Price

30.3$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA