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1. Company Snapshot

1.a. Company Description

Visteon Corporation, an automotive technology company, engineers, designs, and manufactures automotive electronics and connected car solutions for vehicle manufacturers worldwide.The company provides instrument clusters, including analog gauge clusters to 2-D and 3-D display-based devices; information displays that integrate a range of user interface technologies and graphics management capabilities, such as 3-D, active privacy, TrueColor enhancement, cameras, optics, haptic feedback, and light effects; and Phoenix, a display audio and embedded infotainment platform, as well as onboard artificial intelligence-based voice assistant with natural language understanding.It also offers wired and wireless battery management systems; telematics control unit to enable secure connected car services, software updates, and data; and head-up displays.


In addition, the company provides SmartCore, an automotive-grade, integrated domain controller; DriveCore, a platform for addressing multiple levels of vehicle automation; and body domain modules, which integrate various functions, such as central gateway, body controls, comfort, and vehicle access solutions into one device.Visteon Corporation was incorporated in 2000 and is headquartered in Van Buren, Michigan.

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1.b. Last Insights on VC

Visteon Corporation faced negative drivers over the recent three months. Institutional investors, including Teacher Retirement System of Texas, reduced their holdings by 13.0%, selling 2,503 shares. Conversely, Envestnet Asset Management Inc. and Ethic Inc. increased their stakes by 42.4% and 28.4%, respectively. The company's Q3 2025 earnings call revealed quarterly earnings of $2.15 per share, beating estimates. However, no information on share buybacks or significant new product announcements was available. Visteon participated in investor conferences, including the Baird 55th Annual Global Industrial Conference.

1.c. Company Highlights

2. Visteon's Q3 2025 Earnings: Strong Operational Performance Amidst Challenges

Visteon reported a robust financial performance for the third quarter of 2025, with sales reaching $917 million, slightly below expectations due to the unplanned production shutdown at JLR, which impacted sales by approximately $12 million. The year-over-year decline in sales was 6%, primarily attributed to lower battery management system sales in the Americas and reduced sales in China. Despite this, adjusted EBITDA was $119 million, representing a margin of 13%, driven by operational execution and disciplined cost control. The actual EPS came out at $2.15, beating estimates of $2.07. Adjusted free cash flow for the quarter was $110 million, demonstrating the company's ability to generate cash.

Publication Date: Oct -26

📋 Highlights
  • Strong Operational Performance:: Q3 adjusted EBITDA of $119 million (13% margin) driven by cost discipline and operational execution.
  • Shareholder Returns Resumed:: $0.15/share quarterly dividend paid, with $125 million remaining for share repurchases and $20-30 million in Q4 share retirements.
  • Healthy Cash Position:: $459 million net cash at quarter-end, with 56% EBITDA-to-cash conversion (exceeding 40% target) and $110 million adjusted free cash flow.
  • New Business Momentum:: $1.8 billion in Q3 new business awards, with year-to-date total of $5.7 billion and full-year guidance exceeding $7 billion.
  • 2027 Growth Outlook:: Full-year 2026 guidance maintained, with Q4 EBITDA margins at 12% and 2027 growth driven by Toyota launches and AI-driven cockpit solutions.

Operational Highlights

The company launched 28 new products and secured $1.8 billion in new business during the quarter, with year-to-date new business awards totaling $5.7 billion, up from $4.9 billion in the same period last year. Jerome Rouquet, CFO, highlighted that the company delivered a strong operational and cost performance, with robust cash generation despite lower sales. Visteon closed the quarter with $459 million in net cash and a cash balance of $765 million.

Outlook and Guidance

Visteon maintains its full-year guidance, with adjusted EBITDA and free cash flow expected to remain strong. The company expects a modest sequential increase in Q4 sales, driven by new program launches and higher customer production volumes. Adjusted EBITDA is trending towards the high end of the guidance range, with Q4 EBITDA margins expected to be around 12%. The company also plans to increase capital allocation to shareholders through a recurring quarterly dividend and share repurchases.

Valuation and Growth Prospects

With a P/E Ratio of 9.53 and an EV/EBITDA of 5.69, Visteon's valuation suggests that the market has reasonable expectations from the company. The company's ROE is 22.69%, indicating strong profitability. Visteon remains a compelling long-term investment opportunity, with expectations to benefit from higher demand for digital content in the cockpit and growth in China driven by new model launches. The company's exposure to Toyota, with 10% of sales expected in 2028, driven by launches in 2027, is also a positive factor.

Risks and Challenges

The company flags a developing risk related to recent trade restrictions imposed by the Chinese government on Nexperia, a supplier of semiconductors, which could disrupt production. Additionally, Visteon expects a headwind in 2026 due to a potential decline in battery management system volumes. However, the company is well-positioned to support the trend of AI adoption, particularly in China, with its SmartCore HPC and cognitoAI framework.

3. NewsRoom

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Visteon Corporation $VC Shares Purchased by Geode Capital Management LLC

Nov -24

Source: defenseworld.net

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Creative Planning Buys 11,632 Shares of Visteon Corporation $VC

Nov -24

Source: defenseworld.net

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Envestnet Asset Management Inc. Acquires 10,463 Shares of Visteon Corporation $VC

Nov -16

Source: defenseworld.net

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Visteon Corporation (VC) Presents at Baird 55th Annual Global Industrial Conference Transcript

Nov -12

Source: seekingalpha.com

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Visteon Announces Participation in Upcoming Fourth Quarter 2025 Investor Conferences

Nov -10

Source: prnewswire.com

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Visteon Corporation $VC Stake Lowered by Teacher Retirement System of Texas

Nov -05

Source: defenseworld.net

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Ethic Inc. Raises Stock Holdings in Visteon Corporation $VC

Oct -29

Source: defenseworld.net

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Visteon Corporation (VC) Q3 2025 Earnings Call Transcript

Oct -23

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.72%)

6. Segments

Instrument Clusters

Expected Growth: 6.5%

Visteon's Instrument Cluster segment growth of 6.5% is driven by increasing demand for advanced driver-assistance systems (ADAS), electrification, and autonomous driving technologies. Additionally, OEMs' focus on digitalization, connectivity, and user experience is fueling growth. Furthermore, the rising adoption of hybrid and electric vehicles, as well as the need for more complex and connected instrument clusters, are contributing to the segment's growth.

Cockpit Domain Controller

Expected Growth: 6.8%

The 6.8% growth of Cockpit Domain Controller from Visteon Corporation is driven by increasing demand for autonomous and connected vehicles, growing need for advanced infotainment systems, and rising adoption of electric vehicles. Additionally, Visteon's strategic partnerships and investments in digital cockpit technology are contributing to its market share expansion.

Infotainment

Expected Growth: 7.2%

Visteon's Infotainment segment growth of 7.2% is driven by increasing demand for connected car technologies, rising adoption of autonomous driving features, and growing need for user-friendly interfaces. Additionally, the company's strategic partnerships with major OEMs, such as Ford and Nissan, have contributed to its growth momentum.

Information Displays

Expected Growth: 7.5%

Visteon Corporation's 7.5% growth in Information Displays is driven by increasing demand for advanced automotive electronics, rising adoption of autonomous and connected vehicles, and growing need for digital instrument clusters and infotainment systems. Additionally, the company's strategic partnerships and investments in emerging technologies such as artificial intelligence and 5G connectivity are contributing to its growth momentum.

Body and Electrification Electronics

Expected Growth: 6.2%

Visteon's Body and Electrification Electronics segment growth of 6.2% is driven by increasing demand for electric vehicles, autonomous driving, and advanced safety features. OEMs' focus on reducing emissions and improving fuel efficiency also fuels growth. Additionally, Visteon's innovative solutions in electrification, thermal management, and smart surfaces contribute to the segment's expansion.

Other

Expected Growth: 6.8%

Visteon's 6.8% growth in 'Other' segment is driven by increasing demand for autonomous driving and electrification technologies, as well as growing sales of infotainment and connected car solutions. Additionally, the company's strategic partnerships and acquisitions have expanded its product offerings and geographic reach, contributing to the segment's growth.

7. Detailed Products

Smart Displays

Visteon's Smart Displays are advanced human-machine interface (HMI) solutions that provide a seamless and intuitive user experience for drivers and passengers.

DriveCore

DriveCore is Visteon's autonomous driving platform that enables Level 3 and Level 4 autonomous driving capabilities.

SmartCore

SmartCore is Visteon's cockpit domain controller that integrates multiple functions such as infotainment, navigation, and vehicle settings.

Instrument Clusters

Visteon's Instrument Clusters are advanced display solutions that provide drivers with critical vehicle information such as speed, fuel level, and navigation.

Head-Up Displays

Visteon's Head-Up Displays (HUDs) are advanced display solutions that project critical vehicle information onto the windshield.

Infotainment Systems

Visteon's Infotainment Systems are advanced multimedia solutions that provide drivers and passengers with entertainment, navigation, and connectivity features.

8. Visteon Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Visteon Corporation is medium because while there are some substitutes available in the market, they are not a significant threat to the company's business.

Bargaining Power Of Customers

The bargaining power of customers for Visteon Corporation is low because the company has a diverse customer base and no single customer has a significant impact on the company's revenue.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Visteon Corporation is medium because while the company has some suppliers with significant bargaining power, it also has a diverse supplier base.

Threat Of New Entrants

The threat of new entrants for Visteon Corporation is low because the company operates in a capital-intensive industry with high barriers to entry.

Intensity Of Rivalry

The intensity of rivalry for Visteon Corporation is high because the company operates in a highly competitive industry with many established players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 30.01%
Debt Cost 3.95%
Equity Weight 69.99%
Equity Cost 12.22%
WACC 9.74%
Leverage 42.87%

11. Quality Control: Visteon Corporation passed 6 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

Stock-Card
Visteon

A-Score: 6.1/10

Value: 7.6

Growth: 7.3

Quality: 7.1

Yield: 0.0

Momentum: 8.0

Volatility: 6.7

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Lear

A-Score: 5.6/10

Value: 7.9

Growth: 5.1

Quality: 4.1

Yield: 5.0

Momentum: 4.0

Volatility: 7.3

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Dorman Products

A-Score: 5.6/10

Value: 3.7

Growth: 8.0

Quality: 6.5

Yield: 0.0

Momentum: 8.5

Volatility: 6.7

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LKQ

A-Score: 5.4/10

Value: 7.4

Growth: 5.4

Quality: 4.9

Yield: 6.0

Momentum: 2.0

Volatility: 7.0

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BorgWarner

A-Score: 5.2/10

Value: 5.3

Growth: 3.7

Quality: 4.5

Yield: 2.0

Momentum: 8.0

Volatility: 8.0

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Modine

A-Score: 3.9/10

Value: 1.3

Growth: 7.7

Quality: 5.5

Yield: 0.0

Momentum: 6.5

Volatility: 2.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

100.66$

Current Price

100.66$

Potential

-0.00%

Expected Cash-Flows