We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Here's Why You Should Offload Lear Stock From Your Portfolio Now
Read MoreHide Full Article
Lear Corporation (LEA - Free Report) , a supplier of automotive seating and electrical systems (E-Systems), is struggling with economic uncertainty and labor scarcity for wire harness production in the United States.
Let us see why you should offload this Zacks Rank #4 (Sell) stock from your portfolio.
Uncertain Macro Backdrop, Labor Scarcity to Hurt LEA
Ongoing global trade negotiations are creating uncertainty for the economy and the automotive industry. Lear is managing both direct tariff impacts and unclear indirect effects on production volume and mix. Since February, global production forecasts for 2025 have worsened, with it now expecting a 4% decline on a Lear-weighted basis compared with the 2% previously guided. The anticipated decline in global production is likely to hurt the company’s top line in 2025.
The company is facing a major roadblock to moving wire harness production to the United States because of labor scarcity. The wire harness is subject to the 25% tariff, which increases the cost for the company. While just-in-time seat assembly offers attractive, skilled jobs, wire harness production remains highly labor-intensive and less appealing to workers. Despite progress, automation for harnesses is not fully developed, making relocation to the United States difficult due to workforce and technology limitations.
Lear has a concentrated customer base. Six major customers, i.e., BMW, Jaguar, Land Rover, Volkswagen, Mercedez-Benz and BYD, accounted for more than 50% of its total sales in 2024. Losing business with any of these customers would significantly impact the company's top-line growth.
The Zacks Consensus Estimate for LEA’s 2025 sales and earnings per share indicates a year-over-year decline of 5.04% and 7.21%, respectively. The consensus estimate for earnings for 2026 has moved down a penny in the past seven days.
The Zacks Consensus Estimate for HSAI’s 2025 earnings indicates year-over-year growth of 336.36%. EPS estimates for 2026 have improved 12 cents in the past 30 days.
The Zacks Consensus Estimate for RACE’s 2025 sales and earnings implies year-over-year growth of 12.37% and 4.8%, respectively. EPS estimates for 2025 and 2026 have improved 30 cents and 36 cents, respectively, in the past seven days.
The Zacks Consensus Estimate for SMP’s 2025 sales and earnings implies year-over-year growth of 17.1% and 12.62%, respectively. EPS estimates for 2025 and 2026 have improved 6 cents and 2 cents, respectively, in the past 30 days.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Shutterstock
Here's Why You Should Offload Lear Stock From Your Portfolio Now
Lear Corporation (LEA - Free Report) , a supplier of automotive seating and electrical systems (E-Systems), is struggling with economic uncertainty and labor scarcity for wire harness production in the United States.
Let us see why you should offload this Zacks Rank #4 (Sell) stock from your portfolio.
Uncertain Macro Backdrop, Labor Scarcity to Hurt LEA
Ongoing global trade negotiations are creating uncertainty for the economy and the automotive industry. Lear is managing both direct tariff impacts and unclear indirect effects on production volume and mix. Since February, global production forecasts for 2025 have worsened, with it now expecting a 4% decline on a Lear-weighted basis compared with the 2% previously guided. The anticipated decline in global production is likely to hurt the company’s top line in 2025.
The company is facing a major roadblock to moving wire harness production to the United States because of labor scarcity. The wire harness is subject to the 25% tariff, which increases the cost for the company. While just-in-time seat assembly offers attractive, skilled jobs, wire harness production remains highly labor-intensive and less appealing to workers. Despite progress, automation for harnesses is not fully developed, making relocation to the United States difficult due to workforce and technology limitations.
Lear has a concentrated customer base. Six major customers, i.e., BMW, Jaguar, Land Rover, Volkswagen, Mercedez-Benz and BYD, accounted for more than 50% of its total sales in 2024. Losing business with any of these customers would significantly impact the company's top-line growth.
The Zacks Consensus Estimate for LEA’s 2025 sales and earnings per share indicates a year-over-year decline of 5.04% and 7.21%, respectively. The consensus estimate for earnings for 2026 has moved down a penny in the past seven days.
Stocks to Consider
Some better-ranked stocks in the auto space are Hesai Group (HSAI - Free Report) , Ferrari N.V. (RACE - Free Report) and Standard Motor Products, Inc. (SMP - Free Report) . HSAI & RACE sport a Zacks Rank #1 (Strong Buy) each, while SMP carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for HSAI’s 2025 earnings indicates year-over-year growth of 336.36%. EPS estimates for 2026 have improved 12 cents in the past 30 days.
The Zacks Consensus Estimate for RACE’s 2025 sales and earnings implies year-over-year growth of 12.37% and 4.8%, respectively. EPS estimates for 2025 and 2026 have improved 30 cents and 36 cents, respectively, in the past seven days.
The Zacks Consensus Estimate for SMP’s 2025 sales and earnings implies year-over-year growth of 17.1% and 12.62%, respectively. EPS estimates for 2025 and 2026 have improved 6 cents and 2 cents, respectively, in the past 30 days.