NYSE:SRI
STONERIDGE INC
A leading manufacturer of lightweighting solutions and high-performance components for the automotive and industrial sectors worldwide.
Key Metrics
Investment Thesis
Bull Case
Investors may view Stoneridge as a compelling buy due to its essential role in the electrification of transportation, where aluminum lightweighting is critical for extending EV range. The company's strong cash generation from operations and clean balance sheet with zero long-term debt provide financial flexibility to weather industry downturns and fund strategic acquisitions or growth initiatives.
Bear Case
The recent net loss expansion to $-16.5M in 2024 after a narrowing loss in 2023 raises concerns about margin pressure from rising input costs or pricing challenges with key customers. Persistent accumulated other comprehensive losses of $-122.0M and a significant retained earnings deficit of $180.0M suggest underlying profitability issues that could deter growth-oriented investors seeking consistent earnings.
About STONERIDGE INC
Stoneridge Inc. (NYSE:SRI) is a premier global provider of lightweighting solutions, including aluminum extrusions and engineered components for the automotive and industrial markets. The company serves major OEMs in North America, Europe, and Asia, focusing on powertrain systems, battery modules, and chassis structures to help vehicle manufacturers improve fuel efficiency and electric range.
Analysis
Management Discussion
Despite a slight revenue contraction to $908.3M in 2024 from the prior year's $975.8M, Stoneridge demonstrated operational resilience by generating positive operating cash flow of $47.7M against a net loss of $16.5M. The company successfully managed its balance sheet with no long-term debt and increased cash reserves to $71.8M, while investing heavily in R&D ($72.2M) to advance next-generation lightweighting technologies for the electric vehicle transition.
Industry Overview
The automotive lightweighting industry is rapidly evolving as manufacturers shift from internal combustion engines to battery-electric vehicles, driving demand for high-strength aluminum components. Competition is intensifying among global suppliers like Toyota Boshoku and Constellium, but technical expertise in complex extrusion processes remains a key differentiator for market leaders.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Revenue | $899.9M | $975.8M | $908.3M |
| Cost of Revenue | $725.0M | $774.5M | $719.0M |
| Gross Profit | $174.9M | $201.3M | $189.3M |
| Operating Expenses | $172.0M | $188.5M | $189.6M |
| Operating Income | $2.9M | $12.8M | $-381.0K |
| R&D | $65.3M | $71.1M | $72.2M |
| G&A | $106.7M | $117.4M | $117.5M |
| Stock-Based Comp | $5.9M | $3.3M | $4.1M |
| D&A | $33.7M | $33.6M | $34.3M |
| Depreciation | $26.7M | $26.7M | $26.1M |
| Other OpEx | $0 | $0 | $0 |
| Non-Operating Income | $-13.6M | $-14.8M | $-13.2M |
| Interest Expense | — | $-13.0M | — |
| Pre-Tax Income | $-10.7M | $-1.9M | $-13.6M |
| Income Tax | $3.4M | $3.3M | $2.9M |
| Continuing Ops | $-14.1M | $-5.2M | $-16.5M |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $-14.1M | $-5.2M | $-16.5M |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $-14.1M | $-5.2M | $-16.5M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Current Assets | $409.6M | $429.4M | $387.5M |
| Cash & Equivalents | $54.8M | $40.8M | $71.8M |
| Accounts Receivable | $158.2M | $166.5M | $137.8M |
| Inventory | $152.6M | $187.8M | $151.3M |
| Prepaid Expenses | $44.0M | $34.2M | $26.6M |
| Other Current Assets | $0 | $0 | $0 |
| Long-Term Assets | $242.6M | $250.5M | $234.0M |
| PP&E (Net) | $104.6M | $110.1M | $97.7M |
| Intangibles | $45.5M | $47.3M | $39.7M |
| Goodwill | $34.2M | $35.3M | $33.1M |
| Operating Leases | $13.8M | $10.8M | $10.1M |
| Other LT Assets | $44.4M | $47.0M | $53.6M |
| Total Assets | $652.1M | $679.9M | $621.6M |
| Current Liabilities | $177.7M | $178.2M | $150.0M |
| Accounts Payable | $110.2M | $111.9M | $83.5M |
| Current Debt | $1.4M | $2.1M | $0 |
| Current Leases | $3.9M | $3.9M | $4.0M |
| Other Current Liab | $62.1M | $60.3M | $62.5M |
| Long-Term Liabilities | $193.5M | $213.9M | $226.3M |
| Long-Term Debt | $0 | $0 | $0 |
| LT Operating Leases | $10.6M | $7.7M | $6.5M |
| Other LT Liab | $182.9M | $206.3M | $219.8M |
| Total Liabilities | $371.2M | $392.2M | $376.3M |
| Shareholders' Equity | $280.9M | $287.7M | $245.3M |
| Paid-In Capital | $232.8M | $227.3M | $225.7M |
| Retained Earnings | $201.7M | $196.5M | $180.0M |
| AOCI | $-103.1M | $-92.8M | $-122.0M |
| Treasury Stock | $50.4M | — | — |
| Total L&E | $652.1M | $679.9M | $621.6M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Net Income (CFO) | $-14.1M | $-5.2M | $-16.5M |
| Non-Cash Adjustments | $-40.2M | $-7.5M | $131.0M |
| Working Capital Changes | $61.0M | $17.7M | $-66.8M |
| Cash from Operations | $6.8M | $4.9M | $47.7M |
| Capital Expenditures | $27.2M | — | — |
| Cash from Investing | $-28.6M | $-37.0M | $-24.5M |
| Share Buybacks | $0 | — | — |
| Cash from Financing | $-7.3M | $17.5M | $11.1M |
| FX Effect | $-1.7M | $591.0K | $-3.4M |
| Net Change in Cash | $-30.7M | $-14.0M | $31.0M |
| Beginning Cash | $85.5M | $54.8M | $40.8M |
| Ending Cash | $54.8M | $40.8M | $71.8M |
Frequently Asked Questions
How does STONERIDGE INC make money?
The company operates primarily through its Automotive segment, supplying aluminum extrusions, forged parts, and engineered systems for powertrain, chassis, and battery applications. Its Industrial segment provides similar structural and mechanical components to non-automotive markets such as construction, energy, and heavy machinery. Revenue is derived from both original equipment manufacturer (OEM) programs and aftermarket repair services.
What are the main risks for SRI?
The company faces significant exposure to volatile raw material prices, particularly aluminum, which can compress gross margins if not effectively hedged or passed on to customers. Cyclical fluctuations in the global automotive industry, especially a slowdown in EV adoption or reduced OEM capital spending, could lead to order cancellations and factory underutilization. Rising geopolitical tensions and supply chain disruptions may impact logistics costs and the availability of critical components needed for production.
What is SRI's competitive advantage?
Stoneridge leverages its proprietary aluminum extrusion technology to offer superior weight reduction without compromising structural integrity, directly addressing the industry's need for EV range extension. The company benefits from deep integration with top-tier automotive OEMs, creating high switching costs and long-term supply contracts that protect revenue visibility. Its diversified global footprint allows it to mitigate regional demand shocks and capitalize on growth in emerging markets like China and Europe.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.