Stoneridge (SRI) Stock Forecast & Price Target

Stoneridge Inc. has demonstrated resilience in its Electronics segment, with Q4/24 sales reaching $149.4 million, reflecting a 1.8% increase driven by the successful ramp-up of innovative products like MirrorEye and Smart 2 Tachograph, although this growth was moderated by declines in some commercial vehicle markets. The company anticipates strong revenue growth from MirrorEye, projecting an increase of approximately $54 million, or 75%, in 2024, which is expected to further elevate sales to about $120 million as OEM programs expand through 2025. Additionally, Stoneridge's commitment to improving gross margins through material cost initiatives suggests a robust operational strategy, aiming for a midpoint gross margin of approximately 22.25% in 2025, indicating a fundamental strength that supports a positive outlook for the company's stock.

Stoneridge Inc. has reported a significant decline in its adjusted operating margins, with Q4/24 margins at 3.6%, reflecting a 390 basis points decrease from the previous year, attributed to reduced customer reimbursements and increased selling, general, and administrative costs. Furthermore, Q4/24 margins reached an adjusted operating loss of 2.5%, a 380 basis points drop primarily due to lower sales volumes limiting leverage. Expectations for Q1/25 indicate that revenue will likely fall slightly below Q4/24 levels, particularly due to anticipated declines in the Control Devices segment, which has already seen a 16.3% decrease in sales compared to the previous year amid weaker production volumes in the North American market and reduced activity in China.