Back to top

Johnson Controls' Power Solutions Unit Partners With Toshiba

Read MoreHide Full Article

Johnson Controls International plc (JCI - Free Report) has formed a business partnership with Toshiba Infrastructure Systems & Solutions Corp. Per the deal, Cork, Ireland-based Johnson Controls’ Power Solutions unit will tie up with Toshiba to develop and manufacture lithium-ion batteries at the facility in Holland, MI. Notably, this collaboration is aimed at developing dual-battery a-systems.

Importantly, in mid-November, Johnson Controls announced that it is selling its power solutions business to Brookfield Business Partners L.P. and institutional partners. A definitive agreement was signed between Johnson Controls and Brookfield for the sell-off. The sell-off is valued at a cash transaction of $13.2 billion. Depending on regulatory approvals and closing conditions, the transaction is anticipated to close by Jun 30, 2019. (Read more: Johnson Controls to Sell Power Solutions Unit for $13B)

Information firms project that dual-battery vehicles are likely to become the fastest-growing form of electrification soon and are going to account for one-fifth of new vehicles built globally by 2025. Low-voltage dual-battery technology will be the key to the evolution of vehicle systems. Toshiba’s lithium-ion cell expertise and Johnson Controls’ battery system capabilities will produce highly competitive products.

In the past year, Johnson Controls outperformed the industry it belongs to. The company’s shares have decreased 12.1% over this period, whereas the industry declined 32.2%.

Zacks Rank & Key Picks

Currently, Johnson Controls has a Zacks Rank #3 (Hold).

A few better-ranked stocks in the auto space are Allison Transmission Holdings, Inc. (ALSN - Free Report) , Fox Factory Holding Corp. (FOXF - Free Report) and AutoZone, Inc. (AZO - Free Report) . While Allison Transmission and Fox Factory sport a Zacks Rank #1 (Strong Buy), AutoZone carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Allison Transmission has an expected long-term growth rate of 10%. Over the past six months, shares of the company have surged 11.3%.

Fox Factory has an expected long-term growth rate of 17.9%. Over the past six months, shares of the company have risen 61.8%.

AutoZone has an expected long-term growth rate of 12.2%. Over the past six months, shares of the company have risen 32.7 %.

More Stock News: This Is Bigger than the iPhone!

It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.

Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.

Click here for the 6 trades >>

More from Zacks Analyst Blog

You May Like

Published in