Gentherm Incorporated (THRM)
NASDAQConsumer DiscretionaryAuto - PartsSnapshot 2026-09-09
$38.42-2.14%
Close 2026-09-09 · 1-day change
NASDAQConsumer DiscretionaryAuto - PartsSnapshot 2026-09-09
Intact: The reason to own it still holds.
Gentherm grows revenue about 5-7% yearly, reaching $1.7B by 2027. Free cash flow stays strong near $90M in 2026. Profit margins remain healthy around 12%. The company trades cheaper than peers with a PE of 13.3 versus 16.2.
Revenue growth could slow below 5% if auto demand weakens. Free cash flow might fall under $80M due to rising costs. Management volatility could hurt execution and capital allocation.
The stock trades about 15% below our fair value near $40.5. Analysts expect 5.3% revenue growth, which aligns with our view. The market prices in a justified valuation with moderate growth.
Breaks if: Free cash flow falls below $80M in FY26
Breaks if: Profit margin falls below 11.9% in FY25
Breaks if: Revenue falls below $1.5B in FY26 or below $1.7B in FY27
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
THRM represents a speculative growth investment with a focus on revenue growth and product expansion. The current thesis state is cautious due to mixed financial performance and elevated risk factors.
The market seems to price in a justified valuation, but it acknowledges the fragility in execution quality. THRM is currently valued at a premium compared to its peers, indicating that expectations are somewhat aligned but still carry a slight gap.
Management has shown progress in driving revenue growth and improving profitability, but mixed margin trends suggest challenges ahead. Recent financial performance has been neutral, and while the probability of missing earnings is low, the company has experienced erratic earnings surprises.
The thesis hinges on management's ability to maintain credibility after recent guidance changes and the impact of inflation on consumer discretionary spending. Additionally, the performance of sector bellwethers could influence THRM's momentum in the coming quarters.
The most important moves since the prior daily snapshot.
Yes, our read has strengthened. The latest earnings beat supports this improved outlook. There are no new threats impacting the thesis at this time.
as of 2026-09-09
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Breaks if: PE rises above 16.2 without earnings growth
Over the next 1 to 3 years, THRM's outlook is shaped by its operational execution and external economic factors. Not investment advice.