One-glance verdict
Undervalued
$197.73 our estimate vs market $68.17
Wall Street consensus: $82.00 (-58.5% lower than our fair-value estimate)
66% below our estimate, below the bear case
Fundamentals snapshot
Strattec Security Corporation
STRT · NGM · Consumer Cyclical · Auto Parts
Current price
$68.17
52-week range
$57.01 - $93.00
Market cap
$271.16M
Balance sheet
Healthy
73.88x Strong cushion
Net cash $105.77M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 2.5% last year.
- Reward Returns 8.4% on equity, ahead of 60% of its peers.
- Risk Stock trades 7.2% above its 5-year average P/E.
- Risk Insider ownership is only 3.4% (peer median: 6.7%).
What this company does
Strattec Security Corporation
Strattec Security Corporation makes the parts that let you get into and operate a vehicle, like key fobs, door handles, and power liftgates for trunks. The company earns most of its revenue (the money made from sales) by selling these components directly to major automakers. This means Strattec's success is closely linked to the overall health of the car industry, as its business thrives when more new cars are being built and sold.
How the company got here
Strattec began as the automotive lock division of Briggs & Stratton, a company founded in 1908. It was spun off in 1995 to become its own independent company, allowing it to raise its own money and set its own strategy. Over the years, it has grown to become one of the world's largest manufacturers of automotive locks and keys. The company has expanded globally through partnerships and serves major automakers primarily in North America.
What it actually does
Strattec makes systems that allow you to get into and start your car. This includes traditional mechanical locks and keys, as well as modern electronic key fobs and push-button start systems. They also manufacture the door handles, power sliding doors, and power liftgates that open and close parts of the vehicle. Essentially, Strattec creates the products that manage vehicle entry, security, and access for many of the cars you see on the road.
Permission: Locks & Keys
This part of the business focuses on how you are granted entry to your vehicle. It includes the physical locks in the doors and ignition, as well as the mechanical keys that operate them. It also produces the electronic systems that have become common, like key fobs with buttons to lock and unlock doors and passive entry systems that let you open the door as long as the fob is nearby. This segment provides these security and access products directly to car manufacturers, known as original equipment manufacturers (OEMs).
Motion: Power Access
This area of the company creates systems that automatically move parts of a vehicle. Think of power sliding doors on a minivan, a power liftgate on an SUV that opens with the touch of a button, or a power tailgate on a truck. These products are designed to make accessing and using the vehicle more convenient. Strattec engineers these complex mechanical and electronic systems and sells them to the major car companies to be built into new vehicles.
Hold: Latches
This segment is all about securing the doors, hood, and trunk of a vehicle. It produces the latches that hold these parts firmly closed, ensuring safety and security. These are precision-engineered components that car manufacturers rely on for their strength and reliability. When you hear a confident 'click' as you close a car door or trunk, it is the work of a latching system like those made by Strattec.
Aftermarket & BOLT Lock
Beyond selling directly to carmakers, Strattec also serves the aftermarket (the market for parts and accessories after the car has been sold). This includes providing replacement keys, fobs, and locks to locksmiths and auto parts distributors. Additionally, the company has a brand called BOLT Lock, which offers a special line of locks for things like trailers and toolboxes that can be programmed to work with your existing car key.
What management is betting on now
The company is focused on transforming from a supplier of individual parts into a partner that provides complete, integrated access systems for vehicles. This means combining their mechanical, electronic, and software expertise to create seamless experiences for drivers, like using a smartphone as a key. Management is also working to modernize its operations and improve efficiency to become more competitive. A key part of their strategy is to expand their customer base and geographic reach to drive long-term growth in the global automotive market.
Price history
How the share price has moved
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Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2025 Q1
$9.26M
FY2025 Q2
$8.53M
FY2025 Q3
$19.55M
FY2025 Q4
$27.18M
FY2026 Q1
$9.80M
FY2026 Q2
$11.25M
FY2026 Q3
$9.69M
FY2026 Q4
$8.24M
Revenue
$151.83M
Net income
$3.88M
Diluted EPS
0.95
Operating cash flow
$9.65M
Free cash flow
$8.24M
Fetching…
Sources
Revenue
$137.63M
Net income
$3.24M
Diluted EPS
0.78
Operating cash flow
$11.44M
Free cash flow
$9.69M
Fetching…
Sources
Revenue
$137.53M
Net income
$4.95M
Diluted EPS
1.20
Operating cash flow
$13.88M
Free cash flow
$11.25M
Fetching…
Sources
Revenue
$152.40M
Net income
$8.53M
Diluted EPS
2.07
Operating cash flow
$11.33M
Free cash flow
$9.80M
Fetching…
Sources
Revenue
$152.01M
Net income
$8.27M
Diluted EPS
2.02
Operating cash flow
$30.18M
Free cash flow
$27.18M
Fetching…
Sources
Revenue
$144.08M
Net income
$5.40M
Diluted EPS
1.32
Operating cash flow
$20.72M
Free cash flow
$19.55M
Fetching…
Sources
Revenue
$129.92M
Net income
$1.32M
Diluted EPS
0.32
Operating cash flow
$9.44M
Free cash flow
$8.53M
Fetching…
Sources
Revenue
$139.05M
Net income
$3.70M
Diluted EPS
0.92
Operating cash flow
$11.34M
Free cash flow
$9.26M
Fetching…
Sources
Is it cheap or expensive?
Fair value $197.73 vs current price $68.17
Wall Street consensus is the average analyst price target: $82.00 (-58.5% lower than our fair-value estimate).
Our most-likely fair value is $197.73 a share — about 190.1% above today's price of $68.17, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net cash $105.8M - more cash than debt. Interest coverage 73.9x.
Net debt
$-105.77M
Interest coverage
73.88x
Strattec Security Corporation's profit covers its interest bill about 73.9 times over. which is stronger than every peer shown here and 3 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
STRT
BASELINE
Strattec Security Corporation
Total debt $2.48M Interest coverage 73.88x This is the baseline the peer rows are being compared against.
Total debt $156.86M Interest coverage -1.25x -100% vs STRT This peer has almost no interest-payment cushion compared with STRT.
Total debt $232.86M Interest coverage 1.22x -98% vs STRT Carries about 60.6x less debt cushion than STRT.
Total debt $1.24B Interest coverage 0.93x -99% vs STRT Carries about 79.3x less debt cushion than STRT.
Total debt $74.99M Interest coverage 34.98x -53% vs STRT Carries about 2.1x less debt cushion than STRT.
Total debt $146.52M Interest coverage -0.05x -100% vs STRT This peer has almost no interest-payment cushion compared with STRT.
What you should know
The case for and against STRT
3 Rewards
2 Risks
Rewards
-
Revenue grew 2.5% last year.
-
Returns 8.4% on equity, ahead of 60% of its peers.
-
Free cash flow was positive in 6/10 years.
Risks
-
Stock trades 7.2% above its 5-year average P/E.
-
Insider ownership is only 3.4% (peer median: 6.7%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
13.63x
Forward P/E
11.84x
P/B
1.16x
P/S
0.47x
EV/EBITDA
4.67x
PEG ratio
1.58x
Profitability
How much profit each dollar creates
Gross margin
16.5%
Operating margin
1.2%
Net margin
3.6%
ROE
8.4%
ROA
4.1%
Health
Liquidity and balance-sheet strength
Debt / equity
0.01x
Current ratio
2.90x
Quick ratio
2.15x
Total debt
$2.48M
Total cash
$108.24M
Growth
How the business has been compounding
Revenue TTM
$579.39M
Revenue 5Y CAGR
6.4%
EPS TTM
5.00
EPS 5Y CAGR
36.5%
Cash flow
How much cash the business throws off
Operating CF TTM
$46.30M
Free CF TTM
$38.98M
FCF margin
6.7%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
2020-03-12