Sensata Technologies Holding N.V.(NYSE: ST) was downgraded by analysts from SunTrust to “Hold” from “buy” rating. The stock lost over 2.5% on December 1st, 2017 session (as of 1:42PM EST; Source: Google finance). But the shares of ST generated over 25% in this year to date.
Sensata Technologies delivered a revenues rise of 3.6% yoy to $819 million representing in the third quarter of 2017. Performance Sensing reported a 3.1% organic revenue growth while Sensing Solutions delivered a 5.2% organic revenue growth.
Adjusted EBIT margins enhanced 90 basis points from the third quarter of 2016.
The group’s HVOR surpassed the end market growth and implemented a solid backlog of design wins in HVOR.
They forecast underlying production in the HVOR market to rise 5% for the full year 2017. As a result, they estimate that Sensata’s organic revenue growth in these markets would surpass production, which reflects the strong content gains.
China auto business continues to capture content gains and is delivered solid organic growth. But the group gets correlated with the North American auto market even though it is only 19% of our revenues.
The group is also triggering growth within the product families that they acquired from CST, as a result of investments they made into the business over the last 22 months. CST has expanded overall content growth opportunities within the Sensing Solutions portfolio, enhancing their overall growth. The group industrial sensing business delivered double-digit organic revenue growth in the third quarter while the segment is expanding the use of sensors and a variety of industrial applications such as heat and water pumps in HVAC applications.
The group aims to target their new business wins in 2017. They are adding business as customers add sensor content in areas like gas engine exhaust, racing systems for electrified vehicles, electronic control for industrial off-road vehicles and tire pressure sensing systems in China and HVOR market.
The group is well positioned to leverage major trends like electrification, also continuing to benefit from the ongoing secular needs for safety, efficiency and a cleaner more connected world.