1/28/2024 0 Comments Gentex portable scaffold![]() Increasing Costs Pressure Margins: Not only did the company’s gross margin fall from 41% in 4Q20 to 34% in 4Q21, but its operating expenses rose 3% over the same time. For instance, management forecasts pent-up demand for full display mirror products will accelerate that product’s sales higher through 2023. While problems in the global supply chain negatively impacted the company’s operating results in 2021, I believe disruption to the company’s production is temporary and expect volume, revenue, and most importantly, profits to regain 2019 levels. Global semiconductor shortages caused 4Q21 light vehicle volume in the company’s primary markets to fall 20% quarter-over-quarter (QoQ) which led to an 18% QoQ reduction in mirror shipments. Supply Shortages Slow the Company’s Recovery: Gentex’s revenue fell 21% YoY in 4Q21. The company leverages its years of manufacturing experience and deep customer relationships as it looks to grow these offerings. Cabin monitoring system that detects the heartbeat of a child left behind in the backseat of a vehicle.Driving monitoring system that detects changes in driver alertness, gaze location, behavior, and readiness for autopilot return of control.Smartbeam automatic high-beam assist system.HomeLink and HomeLink Connect integrate vehicles with garage doors, home security systems, lights, appliances, and cloud-based home automation services.Dimmable glass can have various applications from sunroofs to the interior cabin of passenger planes.The company’s shipments of FDM grew 7% YoY in 2021. Full Display Mirror (FDM) integrates traditional mirror functionality with rearview camera display.Gentex is investing in the following growth opportunities: Investments Create Growth Opportunities: Despite its dominant market position in automatic-dimming mirrors, the company continues to develop other product lines. Obviously, the vehicle’s source of power has no effect on the need for a rearview mirror. Gentex Is Protected from EV Disruption: While the shift toward electric vehicles (EV) threatens many automotive components, Gentex already supplies EV startups such as Tesla TSLA and Rivian. ![]()
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