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1. Company Snapshot

1.a. Company Description

Commercial Vehicle Group, Inc., together with its subsidiaries, designs, manufactures, produces, and sells components and assemblies in North America, Europe, and the Asia-Pacific regions.It operates in four segments: Vehicle Solutions, Warehouse Automation, Electrical Systems, and Aftermarket & Accessories.The company offers electrical wire harness assemblies that function as current carrying devices in providing electrical interconnections for gauges, lights, control functions, power circuits, powertrain and transmission sensors, emissions systems, and other electronic applications on commercial and other vehicles; and panel assemblies.


It also offers electro-mechanical assemblies, such as box builds, complex automated and robotic assemblies, and large multi-cabinet control cabinets with power distribution and cabling; vinyl or cloth-covered appliqués, armrests, map pocket compartments, and sound-reducing insulations; instrument panels; and plastics decorating and finishing products.In addition, it provides cab structures; design products, including armrests, grab handles, storage systems, floor coverings, floor mats, sleeper bunks, headliners, wall panels, and privacy curtains; and mirrors, wipers, and controls used in commercial, military and specialty recreational vehicles.Further, it offers seats and seating systems, such as mechanical and air suspension, static and military seats, and bus, as well as seats for medium-and heavy-duty trucks (MD/HD trucks); office seating products; and seats, parts, and components for the aftermarket.


The company supplies its products and systems for the commercial vehicle market comprising the MD/HD truck market; and MD/HD truck, bus, construction, mining, agricultural, military, industrial, municipal, off-road recreational, and specialty vehicle markets.Commercial Vehicle Group, Inc.was incorporated in 2000 and is headquartered in New Albany, Ohio.

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1.b. Last Insights on CVGI

The recent stock performance of Commercial Vehicle Group, Inc. was negatively driven by the company's failure to provide a positive earnings update. The lack of a Q4 2024 earnings release prior to the conference call on March 11, 2025, suggests that the company may be facing challenges. Additionally, the company's recent board of directors' election and executive appointments, including Scott Reed as Chief Operating Officer, do not appear to have a direct impact on the company's financial performance. The article "Hidden Gems: 3 Value Stocks to Watch for Strong 2025 Returns" mentions Commercial Vehicle Group as a potential value stock, but this does not necessarily indicate a positive driver.

1.c. Company Highlights

2. CVG's Q3 2025 Earnings: Navigating a Challenging Market

CVG reported a revenue decline to $152.5 million in Q3 2025, compared to $171.8 million in the prior year period, reflecting the challenging market environment. Adjusted EBITDA was $4.6 million, up from $4.3 million in Q3 2024, with adjusted EBITDA margins improving to 3.0%, a 50 basis point increase. The company's adjusted gross margin also showed a sequential improvement, reaching 12.1%. The actual EPS came out at -$0.14, slightly missing estimates of -$0.12.

Publication Date: Nov -24

📋 Highlights
  • Margin Expansion:: Adjusted gross margin improved to 12.1% in Q3 2025, up 10 bps sequentially and 50 bps YoY.
  • Segment Growth:: Global Electrical Systems revenue rose 6% YoY in Q3, driven by 2 new programs with North American autonomous vehicle and European automotive OEMs.
  • Free Cash Flow Progress:: Year-to-date free cash flow reached $25 million, up $14 million YoY, with expected $30 million full-year generation.
  • Guidance Reduction:: 2025 revenue guidance lowered to $640–650 million (down from $650–670 million), and adjusted EBITDA cut to $17–19 million (from $21–25 million).

Operational Highlights

The Global Electrical Systems segment was a bright spot, with revenues increasing by 6% year-over-year, driven by the ramp-up of two key new programs, including one with an autonomous vehicle manufacturer in North America and another with a major automotive manufacturer in Europe. This growth is expected to continue, with the company forecasting high single-digit to low double-digit percentage revenue growth in 2026 for this segment.

Cash Flow and Guidance

CVG generated $25 million in free cash flow year-to-date, up $14 million from the previous year, driven by improved working capital performance and lower capital expenditures. The company expects to generate at least $30 million of free cash flow for the full year. However, due to the challenging market conditions, CVG lowered its full-year 2025 revenue guidance to $640 million to $650 million and adjusted EBITDA guidance to $17 million to $19 million.

Valuation and Outlook

With a P/S Ratio of 0.09 and an EV/EBITDA of 10.49, the market appears to be pricing in a challenging near-term outlook for CVG. The company's ROE and ROIC are negative, at -25.77% and -4.6%, respectively, indicating significant challenges. Analysts estimate next year's revenue growth at -1.0%, suggesting a continued difficult environment. However, the ramp-up of new programs in the Global Electrical Systems segment and the company's focus on operational efficiency improvements and cost savings initiatives may provide a foundation for future growth.

Future Prospects

CVG is preparing for the ramp-up of new program wins in electrical, with several new programs expected to come online in 2026 and 2027, including one with an autonomous vehicle OEM. The company is taking proactive steps to support customers, drive operational efficiency improvements, and deliver better financial results, positioning itself for future growth.

3. NewsRoom

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Commercial Vehicle Group, Inc. (CVGI) Q3 2025 Earnings Call Transcript

Nov -11

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Commercial Vehicle Group (CVGI) Reports Q3 Loss, Lags Revenue Estimates

Nov -11

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CVG Announces Third Quarter 2025 Earnings Call

Oct -29

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New Strong Sell Stocks for August 27th

Aug -27

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Commercial Vehicle Group, Inc. (CVGI) Q2 2025 Earnings Call Transcript

Aug -05

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CVGI Q2 Revenue Beats by 6%

Aug -05

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Commercial Vehicle Group (CVGI) Reports Q2 Loss, Tops Revenue Estimates

Aug -04

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CVG Reports Second Quarter 2025 Results

Aug -04

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.32%)

6. Segments

Vehicle Solutions

Expected Growth: 5%

The 5% growth of Vehicle Solutions from Commercial Vehicle Group, Inc. is driven by increasing demand for medium- and heavy-duty trucks, rising adoption of electric and autonomous vehicles, and growing need for fleet management and telematics solutions. Additionally, the company's focus on innovation, strategic partnerships, and expansion into new markets also contribute to its growth.

Electrical Systems

Expected Growth: 3%

Electrical Systems from Commercial Vehicle Group, Inc. growth driven by increasing demand for electric and hybrid vehicles, stringent emissions regulations, and rising adoption of advanced safety features. Additionally, growing need for efficient energy management and electrification of non-propulsion systems in commercial vehicles fuels growth.

Aftermarket & Accessories

Expected Growth: 4%

The 4% growth in Aftermarket & Accessories from Commercial Vehicle Group, Inc. is driven by increasing demand for replacement parts, rising average vehicle age, and growing fleet sizes. Additionally, the adoption of advanced technologies, such as telematics and autonomous systems, is fueling demand for specialized accessories. Furthermore, the company's strategic expansion into new markets and product lines is also contributing to the segment's growth.

Industrial Automation

Expected Growth: 3%

The 3% growth in Industrial Automation from Commercial Vehicle Group, Inc. is driven by increasing demand for efficient manufacturing processes, adoption of Industry 4.0 technologies, and rising need for supply chain optimization. Additionally, growing investments in electric and autonomous vehicles, and government initiatives promoting industrial automation, are contributing to the segment's growth.

7. Detailed Products

Seats

Commercial Vehicle Group, Inc. designs and manufactures a wide range of seats for commercial vehicles, including truck, bus, and construction equipment seats.

Trim and Cab Interiors

The company offers a variety of trim and cab interior products, including instrument panels, door trim, and headliners, designed to enhance the aesthetic and functional appeal of commercial vehicles.

Wiring Harnesses

Commercial Vehicle Group, Inc. designs and manufactures custom wiring harnesses for commercial vehicles, providing reliable and efficient electrical connections.

Mirrors and Cameras

The company offers a range of mirrors and cameras designed for commercial vehicles, enhancing visibility and safety for drivers.

Electrical and Electronic Systems

Commercial Vehicle Group, Inc. provides a range of electrical and electronic systems, including electrical distribution systems, battery management systems, and more.

Structural Components

The company designs and manufactures structural components, including frames, crossmembers, and other structural parts, for commercial vehicles.

8. Commercial Vehicle Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Commercial Vehicle Group, Inc. is medium due to the presence of alternative products and services in the market, but the company's strong brand reputation and customer loyalty mitigate this threat to some extent.

Bargaining Power Of Customers

The bargaining power of customers for Commercial Vehicle Group, Inc. is low due to the company's strong market position and the lack of concentration among its customer base.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Commercial Vehicle Group, Inc. is medium due to the presence of multiple suppliers in the market, but the company's large scale of operations and strong relationships with suppliers mitigate this threat to some extent.

Threat Of New Entrants

The threat of new entrants for Commercial Vehicle Group, Inc. is low due to the high barriers to entry in the industry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry for Commercial Vehicle Group, Inc. is high due to the presence of several established competitors in the market, leading to a highly competitive environment.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 46.30%
Debt Cost 5.44%
Equity Weight 53.70%
Equity Cost 17.42%
WACC 11.87%
Leverage 86.23%

11. Quality Control: Commercial Vehicle Group, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
XPEL

A-Score: 4.6/10

Value: 4.1

Growth: 9.0

Quality: 7.9

Yield: 0.0

Momentum: 2.5

Volatility: 4.0

1-Year Total Return ->

Stock-Card
Holley

A-Score: 4.0/10

Value: 6.8

Growth: 5.9

Quality: 2.6

Yield: 0.0

Momentum: 6.5

Volatility: 2.0

1-Year Total Return ->

Stock-Card
American Axle

A-Score: 3.7/10

Value: 7.7

Growth: 4.0

Quality: 2.9

Yield: 0.0

Momentum: 4.0

Volatility: 3.7

1-Year Total Return ->

Stock-Card
Stoneridge

A-Score: 3.2/10

Value: 7.6

Growth: 4.3

Quality: 2.6

Yield: 0.0

Momentum: 2.0

Volatility: 2.7

1-Year Total Return ->

Stock-Card
Superior Industries International

A-Score: 3.1/10

Value: 10.0

Growth: 1.9

Quality: 4.4

Yield: 0.0

Momentum: 0.5

Volatility: 2.0

1-Year Total Return ->

Stock-Card
Commercial Vehicle Group

A-Score: 2.6/10

Value: 9.1

Growth: 0.9

Quality: 2.9

Yield: 0.0

Momentum: 1.0

Volatility: 2.0

1-Year Total Return ->

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

1.66$

Current Price

1.66$

Potential

-0.00%

Expected Cash-Flows