Citi Reiterates Buy Rating On MGA

Citi is reiterating its Buy rating on shares of Magna International Inc. MGA.

“With regard to Europe, management reiterated that the region's difficulties are well-understood and addressable over time through footprint optimization, efficiencies and roll-off of unprofitable contracts,” Citi writes. “Management likened some of these issues to those previously experienced and addressed in North America, suggesting familiarity with the playbook.

“We expect Europe margins to improve annually through our forecast period. The 2011 North America operating margin outlook contemplates commodity cost inflation and meaningful launch costs to support new 2012 business. Launch costs could conceivably moderate in 2012 though new business opportunities appear robust.”

Magna International Inc. closed Thursday at $51.02.