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Magna International: Look beyond current cost pressures for longer-term potential

Thiveyen Kathirrasan
Thiveyen Kathirrasan • 3 min read
Magna International: Look beyond current cost pressures for longer-term potential
Photo Credit: Bloomberg
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Performance: -28.6%

Toronto-listed Magna International was the bigger loser in our portfolio for the four-month period, with a 28.6% loss. The company is a global mobility technology company that is one of the world’s largest suppliers in the automotive space. Magna makes the body, exteriors and chassis, powertrain, active driver assistance, electronics, mechatronics, seating systems, roofing, and lighting systems and mirrors for the automotive industry.

The case for the company is that it is a play on the pandemic recovery, through the global demand recovery for the automotive industry. Magna’s position as a supplier of choice for automakers, along with its strong record of financial performance denotes that it is well-positioned to capture growing market opportunities and generate free cash flow. Magna is a key player in the value chain as it covers complete vehicles through its integrated systems, not just separate car parts.

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