Magna International (MGA) is a major auto parts manufacturer that prefers to describe itself more grandly as a “mobility technology company," notes Gordon Pape, editor of Internet Wealth Builder.
It’s been in business for more than 60 years and has 158,000 employees. Its global network includes 347 manufacturing operations and 84 product development, engineering and sales centers spanning 28 countries. It’s home office is in Ontario, Canada.
Magna’s stock gained 30% in 2020 — and is up 38% year to date in 2021 — but I believed there was a lot more to come because of the moves it has been making to consolidate its position in EV space, including a $1 billion joint venture deal with South Korea’s LG Electronics. It will be called LG Magna e-Powertrain and will manufacture e-motors, inverters and onboard chargers.
The company also has a major presence in China’s EV market. Magna’s plant in Jiangxi began production of eDrive gearboxes in 2018 that featured high efficiency, best-in-class power density, excellent noise, vibration and harshness performance, and a complete torque range from 200Nm to 530Nm.
It recently passed a major milestone, with the production of its 100,000th eDrive gearbox. They are used in various car models from sedans to SUVs for several Chinese automakers including NIO and Xpeng.
And that’s just scratching the surface. Magna recently announced it will develop a modular electric vehicle with Israeli start-up REE Automotive. The company will be the exclusive builder of the Fisker Ocean SUV in Europe. It plans to expand its manufacturing facilities in North America. In short, it’s a dynamic company with a growing footprint in the rapidly expanding EV sector.
The company recently reported an 18% increase in first quarter sales, to $10.2 billion. Adjusted diluted earnings per share came in at $1.86, up 116% from the same period in 2020. We continue to rate Magna International as a "buy". The stock was originally recommended by contributing editor Glenn Rogers.
