Meritor, Inc. (MTOR)

Meritor, Inc. (MTOR - Analyst Report) is a globally recognized automotive parts supplier. However, the company has high customer concentration, which implies limited scope for margin expansion. Further, the recent turmoil in the global economy is expected to continue to mar its results.

We are also disappointed about Meritor's deteriorating cash flow. Although the company's fiscal fourth quarter profit was ahead of the Zacks Consensus Estimate by $0.19 per share, we remain concerned about its long-term outlook.

Our long-term Underperform recommendation on the stock indicates that it will perform lower than the broader market. Our $5.50 target price, 3.8X our 2012 EPS estimate, reflects this view.

Meritor, Inc. (MTOR) : FULL ANALYST REPORT

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PREMIUM: Zacks Blog: Auto Industry Stock Outlook & Review – March 2012
(TM, NSANY, HMC, GM, F, DDAIF, AXL, ARM, GT, MGA, SUP, TEN, TRW, PEUGY)	03/20/12

PREMIUM: Zacks Blog: Auto Industry Stock Outlook – Aug. 2011
(TM, NSANY, HMC, GM, F, DDAIF, AXL, ARM, GT, MGA, SUP, TEN, TRW, TTM, HYMLF)	08/26/11

PREMIUM: Zacks Blog: Auto Industry Outlook and Review - May 2011
(TM, NSANY, HMC, GM, F, AXL, ARM, GT, MGA, SUP, TEN, TRW)	05/24/11

PREMIUM: Zacks Blog: Auto Industry Outlook and Review – March 2011
(TM, NSANY, HMC, GM, F, AXL, ARM, GT, MGA, SUP, TEN, TRW, JCI, TT)	03/10/11

Zacks Blog: Moody's Upgrades ArvinMeritor
(MCO, NAV, ARM)	02/23/11

DJIA	12496.15	-6.66	-0.05%
NASD	2850.12	0.00	0.00%
S&P 500	1318.86	2.23	0.17%

Meritor, Inc. (MTOR)

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