- Morgan Stanley analyst Adam Jonas upgraded American Axle & Manufacturing Holdings Inc AXL to Overweight from Underweight with a price target of $16, up from $8, implying a 77% upside.
- While many other legacy OEMs and suppliers plough cash flow into EV projects that "will likely not generate their cost of capital," Jonas thinks American Axle is different and believes that the company will likely use the majority of its cash flow to de-lever the balance sheet.
- Jonas forecasts American Axle's levered free cash flow to be $1.5 billion through FY25, which he notes would be an amount equal to 150% of its market cap and enough to reduce about 60% of net debt.
- Price Action: AXL shares are trading higher by 4.63% at $9.03 on the last check Monday.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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