Magna International is Your Auto and EV One-Stop Shop StockWorldwide vehicle parts manufacturer Magna International (NYSE: MGA) is not a household name yet is the largest automotive supplier in North America

Worldwide vehicle parts manufacturerMagna International (NYSE: MGA)is not a household name yet is the largest automotive supplier in North America and fourth largest in the world. The Company is contracted with over 50 global customers including the largest automotive brands in the world likeFord (NYSE: F)andGeneral Motors (NYSE: GM)as well as major European players likeVolkswagen (OTCMKTS: VWAGY)and BMW. The Company manufactures everything from doors, seats, legacy andelectricpowertrains, and transmissions to manufacturing complete automobiles. Magna is a one-stop shop and the largest contractmanufacturerfor automobiles in the world with annual production capacity of over 200,000 vehicles.

Riding the Automotive Megatrends

They are on the cutting edge of trends in the automotive industry likeelectrification,electric vehicles(EVs), energy storage systems, autonomous driving, mobility, and connectivity. While most of their nearly $39 billion of sales comes from legacy automobile business, it's positioned to benefit from megatrends in the auto industry. The originalTesla (NASDAQ: TSLA)killer,Fisker (NYSE: FSR)will start production of its highly anticipated EVs in November. Magna is handling the complete manufacturing of the EVs. While they face the continuous headwinds ofsupply chain constraints, inflationary cost pressures, and astrong U.S. dollar, they are also reaping the tailwinds of strong auto demand and lowdealer inventorylevels. The stock is a one-stop shop for investors seeking a diversified major player riding the megatrends in the auto industry.

Attractive Pullback Levels

Usingthe rifle chartson the weekly and daily time frames provide a comprehensive view of the price for MGA stock. The weekly rifle chart breakdown triggered on the rejection of the breakout attempt at the $65.24Fibonacci (fib) level. The weekly downtrend has a falling 5-period moving average (MA) resistance at $53.39 followed by the weekly 15-period MA resistance falling at $57.69 as the weekly stochastic falls to the 20-band. The stock failed three separate attempts to stay above the weeklymarket structure low (MSL)买触发导致股价下跌62.99美元wards the weekly lower Bollinger Bands (BBs) at $46.55. The daily rifle chart has been in a downtrend led by the falling 5-period MA resistance at $49.54 followed by the 15-period MA at $53.18. The daily lower BBs sit at $45.35. The daily stochastic has crossed up but is stalling at the 10-band. It needs to crack the 20-band to gain upside momentum.Attractive pullback levels remain at the $46.26, $44.25 fib, $41.99 fib, $38.32 fib, $34.65 fib, and the $31.02 fib.

Second Half 2022 Recovery

2021年7月29日,麦格纳公布第二财-quarter 2022 results for the quarter ending June 2022. The Company reported an earnings-per-share (EPS) profit of $0.83 excluding non-recurring items versus consensus analyst estimates for $0.92, a (-$0.09) beat. Revenues rose 3.6% year-over-year (YoY) to $9.36 billion beating analyst estimates for $8.92 billion. The Company saw a 2% rise in light vehicle production, largely driven by a 14% jump in sales in North America. FX translations took a (-$629 million) bite out of earnings as well as lower sales in Russia. Higher input costs, Russia, and operating inefficiencies in Europe resulted in a (-41%) YoY drop in adjusted EPS from $1.40 to $0.83 and diluted EPS of (-$0.54) versus $1.40 in the year ago period. This was affected by a (-$1.24) non-cash impairment charge on its investment in Russia. However, the Company is optimistic for a second-half recovery. Magna raised its full-year 2022 revenues to come in between $37.6 billion to $39.2 billion, up from prior guidance of $37.2 billion to $38.9 billion versus $37.75 billion consensus analyst estimates.

Looming Headwinds

Magna CEO, Swamy Kotagiri expects supply chain problems to continue through 2022. These include semiconductor shortages to parts manufactured in China with COVID lockdowns. Input costs were and will remain elevated. He did remind analysts, "The stronger US dollar relative to other currencies, in which we operate, particularly the euro, is negatively impacting our reported results, and there is some risk going forward that high inflation and rising rates will impact auto consumers."

Strong Tailwinds

The Company is experiencing strong auto demand with low dealer inventories and tight supply.Semiconductorsupply constraints are expected to ease in the second half of 2022. The easing of China COVID lockdowns in addition to a government economic stimulus package should improve supply chains and bolster auto demand.