FBR Capital Starts Gentherm Incorporated (THRM) at Market Perform

FBR Capital initiates coverage on Gentherm Incorporated (NASDAQ: THRM) with a Market Perform rating and a price target of $40.00.

Analyst Christopher Van Horn comments, "The company's revenue has increased significantly during the past three quarters, and we expect a double-digit sales increase in 2014. Gentherm is highly leveraged to the original equipment manufacturer (OEM) market, and business is improving, mainly due to increasing new vehicle production. Therefore, we think that there could be potential upside to our revenue and earnings estimates should the company continue to execute. Given Gentherm's heavy exposure and margin leverage to rising OEM production rates, we believe the company can drive volume and EPS growth as part of the current up-cycle within the new vehicle market. Based on this robust market, we expect continued growth in EPS through 2015 and beyond. Yet, at current levels, we think that some growth prospects have been priced into the stock and that there are alternative options within the automotive space. Accordingly, we initate at Market Perform. However, we will continue to monitor Gentherm's new product growth and adoption rates and will look for an opportunity to potentially become more constructive on the name."

For an analyst ratings summary and ratings history on Gentherm Incorporated click here. For more ratings news on Gentherm Incorporated click here.

Shares of Gentherm Incorporated closed at $39.50 yesterday.

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