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    Stabilus (XTRA:STM) Stock Looks Cheap As Automation Gains Gather Pace

    Simply Wall St·08/04/2026 04:51:28
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    Stabilus went into this earnings print looking bruised, with the stock at €15 and trailing 90‑day returns in decline. Yet Q3 landed with a very different story. The company produced about €299.5m of revenue and €2.07 basic earnings per share, and management kept full year guidance for around €1.15b of revenue and a roughly 10% adjusted earnings before interest and tax margin.

    The market is still pricing Stabilus on a modest 6.5x P/E despite a reported 9.3% earnings lift over the past year. That disconnect between lowly rated stock and improving profit metrics will be the core debate after these results.

    Is Stabilus a clear value opportunity at a 6.5x P/E and a share price far below the stated fair value, or is the weak interest coverage a warning sign you should not ignore? See how the current market price lines up with earnings quality and peer multiples in our valuation analysis for Stabilus

    Q3 2026 Earnings Summary

    • Revenue (Q3 2026 vs Q3 2025): €299.5m vs. €316.0m (declined about 5%)
    • Net Income (Excl. Extra Items, Q3 2026 vs Q3 2025): €51.2m vs. €9.8m (more than fourfold increase)
    • Basic EPS (Q3 2026 vs Q3 2025): €2.07 vs. €0.40 (more than fourfold increase)
    • Adjusted EBIT Margin (Q3 2026 vs Q3 2025): 10.8% vs. 10.5% (slight improvement)

    Prefer clean charts instead of another wall of earnings tables and footnotes? See how Stabilus compares at a glance with a full visual breakdown of its valuation in our company report for Stabilus.

    XTRA:STM Trailing 12-Month Revenue & Expenses Breakdown as at Aug 2026
    XTRA:STM Trailing 12-Month Revenue & Expenses Breakdown as at Aug 2026

    Stabilus Bull Case Hinges On Industrial Shift Milestones

    The bullish view on Stabilus is that automation investments and the DESTACO deal would turn industrial and automation into a higher margin growth engine while easing reliance on cars. Q3 gives that thesis some real milestones. Industrial and automation revenue grew organically by more than 8% and management calls this segment the main profit engine. That supports the idea that the mix is tilting toward higher margin non automotive activity.

    At the same time, the automotive business declined organically by about 15% and remains the main drag. The bullish claim is not that auto recovers quickly but that Stabilus offsets that pressure. Here, the evidence is mixed but constructive. Adjusted EBIT margin edged up to 10.8% even with lower group sales, helped by cost programs and the DESTACO contribution. The humanoid actuator partnership and early customer samples also show the automation narrative starting to translate into concrete projects.

    Compare Stabilus’ early automation wins with what institutional analysts are actually baking into their models to see whether the current €15 price lines up with street conviction. See the consensus price target analysis for Stabilus

    Stabilus Bear Worries On Pricing And Autos Not Resolved

    The bearish story on Stabilus centers on weak automotive volumes, price pressure in China and the risk that these squeeze margins and cash flow. Q3 does not clear those hurdles. Automotive revenue fell about 15% organically, and management still points to softer OEM production and cautious customer signals. That keeps the demand risk very much alive.

    Pricing worries also remain. APAC revenue declined about 18%, with management attributing roughly 5% to 6% price erosion in China. That is exactly the type of competitive pressure bears anticipated. Margin held at 10.8% adjusted EBIT, helped by mix and cost savings, so the feared near term collapse in profitability did not show up. However, free cash flow year to date is lower once adjusted for the divestments, and guidance for about €90m still relies on a strong Q4. The structural concerns are not disproved by this quarter.

    After significant one-off items and weaker interest cover, are these margin swings a temporary occurrence or a structural issue? Review our risk analysis for Stabilus which shows 4 important warning signs

    Take Control Of Your Next Move

    If the mix of low 6.5x P/E, a €15 share price and shifting segment performance has put Stabilus on your radar, register for free with Simply Wall St and add it to a Watchlist to track price against fair value and spot a potential entry point that fits your plan. Once you are invested, use the Portfolio Command Center to cut through noise and focus on the key developments that matter to your holdings. For longer term context, tap into the Community to see how other investors are thinking about the same risks and catalysts. This is one way to surface potential turning points early, keep sight of hidden risks and stay a step ahead of the market.

    Seeking Alternatives Beyond Stabilus Today

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.