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Bull of the Day: Delphi Technologies (DLPH)

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Headquartered in London, U.K., Delphi Technologies PLC (DLPH - Free Report) is a technology company specializing in the manufacturing, development and design of integrated powertrain technologies to increase vehicle efficiency, reduce emissions, improve driving and engine performance, and support increasing electrification of vehicles.

On Dec 4, 2017, Delphi Technologies became an independent, publicly-traded company. Prior to this, it operated as the Powertrain Systems segment of Delphi Automotive PLC. The company manages technical centers, manufacturing sites and customer support services in 24 countries.

Strong Results

The company reported strong Q1 results, beating on both the top and bottom lines.  Adjusted earnings of $1.30 per share were ahead of the consensus by 14 cents.

Revenues of $1.30 billion also surpassed the Zacks Consensus Estimate of $1.26 billion and were up 10.9% year over year.

The management also raised its outlook for full year 2018. It now expects adjusted earnings to be in the range of $4.65–$4.95 per share, compared with $4.50–$4.80 expected earlier.

The company continues to see strong demand for more fuel-efficient propulsion systems and acceleration in activity around electrification.

Rising Estimates

After a strong quarterly report, analysts have significantly raised their estimates for the company.

Zacks Consensus Estimates for the current and the next fiscal year have increased to $4.94 per share and $5.44 per share respectively, from $4.80 per share and $5.12 per share, before the results. 

Bottom Line

The company works with world's leading passenger car and truck manufacturers to help them deliver cleaner and more efficient internal combustion solutions.

As vehicle manufacturers are looking at technologies and varying levels of electrification to get cleaner and more fuel-efficient cars and trucks on the road, Delphi Technologies is poised to benefit from these trends.

The stock currently has a Zacks Rank #1 (Strong Buy). It is currently trading at 8.98 times forward earnings, which makes it looks pretty attractive in terms in valuation considering its growth potential.  The stock has Zacks Style Score of “A” for Value as well as Growth, resulting in a VGM Score of “A”.

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