Assessing Garrett Motion (GTX) Valuation After Recent Share Price Pullback

What Garrett Motion does and how the stock has been trading

Garrett Motion (GTX) designs and sells turbocharging and high speed electric motor technologies used across light and commercial vehicles, industrial applications, and zero emission systems, giving its stock a mix of traditional and newer propulsion exposure.

Recently, the share price has seen a 2.4% decline over the past day, a 4.3% decline over the past week, and a 15% fall over the past month, while the past 3 months show a 3.6% gain.

See our latest analysis for Garrett Motion.

Viewed together, Garrett Motion's recent pullback, including a 15.1% 30 day share price return decline to around $17.67, contrasts with a much stronger picture over time. The 1 year total shareholder return of about 101% and 5 year total shareholder return above 200% point to momentum that has cooled in the short term but remains robust over longer horizons, hinting that investors may be reassessing near term risks after a strong multi year run.

If Garrett's mix of turbocharging and electric technologies has your attention, it could be a good moment to see what else is on the move in powertrain and mobility. You can start with our 23 power grid technology and infrastructure stocks as a curated set of related opportunities to compare against GTX.

So with Garrett trading around $17.67, annual revenue of about $3.6b, net income of roughly $310m and a value score of 6, is there still mispricing here, or is the market already baking in future growth?

Most Popular Narrative: 20.4% Undervalued

Garrett Motion's most followed narrative currently points to a fair value of $22.20 versus the last close at $17.67, framing the stock as materially discounted before you even look at the growth drivers behind that view.

Ongoing innovation and proof-of-concept awards in zero-emission technologies (E-Powertrain, E-Cooling, and fuel cell compressors) and expansion in industrial/non-automotive end markets are positioning Garrett to capture higher-margin business opportunities and diversified growth, supporting both revenue and future margin expansion.

Read the complete narrative.

Curious how modest revenue and earnings growth assumptions, slightly higher margins, and a lower future P/E multiple all still line up with a higher fair value? The most followed narrative lays out a detailed earnings path, factors in buybacks, and then discounts those future cash flows at a specific rate to land on $22.20.

Result: Fair Value of $22.20 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, that upside view still depends on Garrett offsetting potential pressure from weaker diesel and aftermarket margins, and managing any long term drag from shrinking ICE turbo demand.

Find out about the key risks to this Garrett Motion narrative.

Next Steps

With both risks and rewards in play, does this story match how you see Garrett today? Take a moment to review the details and weigh both sides, starting with 5 key rewards and 3 important warning signs.

Looking for more investment ideas?

If Garrett has sharpened your thinking, do not stop here. Broaden your watchlist with a few focused screens that surface different types of opportunities.

• Start with dependable cash generators by checking companies in our 15 dividend fortresses that can help anchor the income side of your portfolio.
• Zero in on potential mispricing by reviewing the 47 high quality undervalued stocks, where solid fundamentals meet prices that may not fully reflect them.
• Add potential future leaders to your radar through the screener containing 25 high quality undiscovered gems, a list built to highlight quality names that often sit off the usual radar.

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.

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