Financial Performance & Guidance - Q2 2025 sales for continuing operations were $2.047 billion, compared to $1.935 billion in Q2 2024[25] - Q2 2025 adjusted EBITDA for continuing operations was $145 million, up from $110 million in Q2 2024, with a margin of 7.5%[25] - The company increased its full-year 2025 profit guidance by $35 million and free cash flow guidance by $50 million for continuing operations[12] - Full-year 2025 sales guidance for continuing operations is approximately $7.4 billion[21] - Full-year 2025 adjusted EBITDA guidance for continuing operations is approximately $575 million[21] - Full-year 2025 adjusted free cash flow guidance is approximately $275 million[21] Strategic Initiatives - The company announced a definitive agreement to sell its off-highway business[8] - The sale of the off-highway business is expected to close late in the fourth quarter of 2025, with net cash proceeds of $2.4 billion from a $2.7 billion purchase price[11] - The company announced a $1 billion capital return authorization and a $2 billion debt reduction plan[8] - The company repurchased 14.6 million shares in Q2, representing 10% of shares outstanding, returning $257 million to shareholders[11] - The company anticipates a $100 million to $150 million share repurchase in Q3[11]

[Dana Inc. Q2 2025 Earnings Report Overview](index=1&type=section&id=Dana%20Incorporated%20Reports%202025%20Strong%20Second-quarter%20Financial%20Results) [Q2 2025 Key Highlights](index=1&type=section&id=Second%20Quarter%20Highlights) Dana reported strong Q2 2025 results, driven by the Off-Highway business sale, capital return, and cost savings - Announced a definitive agreement to sell the Off-Highway business for a purchase price of **$2.7 billion**, with expected net cash proceeds of **$2.4 billion**[2](index=2&type=chunk)[36](index=36&type=chunk) - Initiated a **$1 billion** capital return program, repurchasing **14.6 million shares** (**10%** of shares outstanding) for **$257 million** in Q2 2025[2](index=2&type=chunk)[6](index=6&type=chunk)[36](index=36&type=chunk) - The cost-savings initiative goal has been increased to **$310 million** through 2026, with **$59 million** realized in Q2 and **$110 million** year-to-date[2](index=2&type=chunk)[6](index=6&type=chunk)[33](index=33&type=chunk) - Raised full-year 2025 guidance for continuing operations, increasing sales by **$250 million**, adjusted EBITDA by **$35 million**, and adjusted free cash flow by **$50 million**[5](index=5&type=chunk)[6](index=6&type=chunk) [Strategic Developments and Capital Allocation](index=1&type=section&id=Strategic%20Developments%20and%20Capital%20Allocation) [Sale of Off-Highway Business](index=1&type=section&id=Sale%20of%20Off-Highway%20Business) Dana strategically sells its Off-Highway business for $2.7 billion to focus on light and commercial vehicle markets - The sale is a key step in the strategy to become a more focused supplier to light and commercial vehicle markets[2](index=2&type=chunk) Off-Highway Business Sale Details | Metric | Value | | :--- | :--- | | **Purchase Price** | $2.7 billion | | **Net Cash Proceeds** | $2.4 billion | | **Expected Closing** | Late Q4 2025 | - Following the sale, the Off-Highway business results will be reported as discontinued operations for all periods[1](index=1&type=chunk)[7](index=7&type=chunk) [Capital Allocation and Shareholder Returns](index=1&type=section&id=Capital%20Allocation%20and%20Shareholder%20Returns) Dana authorized $1 billion in capital returns and $2 billion in debt reduction, prioritizing growth and shareholder value - Announced a **$1 billion** capital return authorization through 2027 and a **$2 billion** debt reduction plan[33](index=33&type=chunk)[60](index=60&type=chunk) - Increased the 2025 capital return target to approximately **$600 million**[6](index=6&type=chunk)[36](index=36&type=chunk) - Repurchased **14.6 million shares** for **$257 million** in Q2 and anticipates an additional **$100-$150 million** in share repurchases in Q3[6](index=6&type=chunk)[36](index=36&type=chunk) - Capital allocation priorities include funding organic growth, reducing debt to a target net leverage of **~1x**, and shareholder returns via dividends and buybacks[59](index=59&type=chunk)[60](index=60&type=chunk) [Cost Savings Initiative](index=1&type=section&id=Cost%20Savings%20Initiative) Dana's expanded cost-savings program targets $310 million by 2026, with significant Q2 progress mitigating cost inflation - The total cost reduction program goal has been increased to **$310 million** through 2026[6](index=6&type=chunk)[33](index=33&type=chunk) Cost Savings Realized in 2025 | Period | Savings Realized (USD) | | :--- | :--- | | **Q2 2025** | $59 million | | **YTD 2025** | $110 million | - The cost-savings program is a key factor in the company's commitment to deliver a **10% adjusted EBITDA margin** in 2026[2](index=2&type=chunk) [Q2 2025 Financial Performance (Continuing Operations)](index=1&type=section&id=Q2%202025%20Financial%20Performance%20%28Continuing%20Operations%29) [Consolidated Financial Results](index=1&type=section&id=Consolidated%20Financial%20Results) Q2 2025 sales decreased, but adjusted EBITDA and margin improved due to cost savings and tariff recoveries Q2 2025 Financial Results (Continuing Operations) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | **Sales** | $1.95 billion | $2.05 billion | ($0.10 billion) | | **Adjusted EBITDA** | $145 million | $110 million | +$35 million | | **Adjusted EBITDA Margin** | 7.5% | 5.4% | +210 bps | | **Loss Before Tax** | ($24 million) | ($53 million) | +$29 million | | **Operating Cash Flow** | $36 million | $215 million | ($179 million) | | **Adjusted Free Cash Flow** | ($5 million) | $104 million | ($109 million) | [Sales and Adjusted EBITDA Analysis](index=19&type=section&id=Sales%20and%20Adjusted%20EBITDA%20Analysis) Q2 sales declined due to volume/mix, yet adjusted EBITDA improved significantly from cost savings and performance - Sales for continuing operations decreased from **$2,047 million** in Q2 2024 to **$1,935 million** in Q2 2025, mainly due to a negative volume/mix impact of **$172 million**[46](index=46&type=chunk) - Adjusted EBITDA for continuing operations increased from **$108 million** to **$145 million**. The key drivers were cost savings (**+$59 million**) and performance (**+$30 million**), which offset negative impacts from volume/mix (**-$52 million**) and tariffs (**-$15 million**)[46](index=46&type=chunk)[47](index=47&type=chunk) [Free Cash Flow Analysis](index=20&type=section&id=Free%20Cash%20Flow%20Analysis) Q2 adjusted free cash flow decreased due to working capital and higher taxes, partially offset by higher EBITDA - Adjusted free cash flow includes cash from both continuing and discontinued operations to align with the sale transaction structure[49](index=49&type=chunk) - Working capital was a significant headwind, with a year-over-year negative change of **$159 million**, attributed to timing after strong Q1 performance[48](index=48&type=chunk)[49](index=49&type=chunk) - Capital spending was lower by **$70 million** year-over-year due to the timing of investments[48](index=48&type=chunk)[49](index=49&type=chunk) [Full-Year 2025 Guidance and Outlook](index=2&type=section&id=Full-Year%202025%20Guidance%20and%20Outlook) [Revised 2025 Full-Year Guidance](index=2&type=section&id=Revised%202025%20Full-Year%20Guidance) Dana raised full-year 2025 guidance for continuing operations, reflecting improved cost performance and tariff recoveries Full-Year 2025 Guidance (Continuing Operations) | Metric | Current Guidance (USD) | Midpoint of Prior Method (Illustrative, USD) | | :--- | :--- | :--- | | **Sales** | $7.25 - $7.55 billion | ~$9.9 billion | | **Adjusted EBITDA** | $540 - $610 million | ~$990 million | | **Implied Adj. EBITDA Margin** | 7.4% - 8.1% | ~10.0% | | **Adjusted Free Cash Flow** | $225 - $325 million | ~$275 million | - The guidance increase reflects higher tariff recoveries, enhanced cost performance, and reduced working capital requirements[5](index=5&type=chunk) [Full-Year Sales and Profit Drivers](index=22&type=section&id=Full-Year%20Sales%20and%20Profit%20Drivers) Full-year sales are projected to decline due to volume/mix, but profit is expected to rise from performance and cost savings - Full-year sales are expected to be impacted by negative volume/mix (**-$425 million**) and currency headwinds (**-$45 million**)[53](index=53&type=chunk) - The profit impact of volume declines is expected to be more than offset by pricing and operating efficiency efforts[54](index=54&type=chunk) - Anticipated tariffs are expected to have a negative profit impact of **~$35 million** due to time lags in recoveries[53](index=53&type=chunk)[54](index=54&type=chunk) [Full-Year Free Cash Flow Outlook](index=23&type=section&id=Full-Year%20Free%20Cash%20Flow%20Outlook) Dana forecasts a significant increase in full-year adjusted free cash flow, driven by higher EBITDA and working capital - Adjusted free cash flow is expected to increase by **~$195 million** year-over-year[55](index=55&type=chunk) - Key drivers for the improvement include higher profit, a **~$100 million** positive change in working capital, and a **$45 million** reduction in net capital spending[55](index=55&type=chunk)[56](index=56&type=chunk) [Long-Term Outlook (2026 and Beyond)](index=25&type=section&id=Long-Term%20Outlook%20%282026%20and%20Beyond%29) Dana targets 10-10.5% adjusted EBITDA margins and 4% free cash flow by 2026, supported by cost savings - Targets adjusted EBITDA margins of **10% - 10.5%** in 2026[65](index=65&type=chunk) - Expects adjusted free cash flow to be approximately **4% of sales** in 2026[65](index=65&type=chunk) - The **$310 million** cost savings plan is on track for completion in 2026[62](index=62&type=chunk) [Segment Performance (Continuing Operations)](index=5&type=section&id=Segment%20Performance%20%28Continuing%20Operations%29) [Light Vehicle Segment](index=5&type=section&id=Light%20Vehicle%20Segment) Light Vehicle sales decreased in Q2, but adjusted EBITDA and margin improved due to strong performance and cost savings Light Vehicle Q2 Performance | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Sales** | $1,335 million | $1,401 million | | **Adjusted EBITDA** | $112 million | $90 million | | **Adjusted EBITDA Margin** | 8.4% | 6.4% | - Ford is the largest customer, accounting for **44%** of year-to-date sales, followed by Stellantis at **16%**[70](index=70&type=chunk) [Commercial Vehicle Segment](index=5&type=section&id=Commercial%20Vehicle%20Segment) Commercial Vehicle sales declined in Q2, yet adjusted EBITDA and margin improved from performance and cost savings Commercial Vehicle Q2 Performance | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Sales** | $600 million | $646 million | | **Adjusted EBITDA** | $47 million | $39 million | | **Adjusted EBITDA Margin** | 7.8% | 6.0% | - Paccar is the largest customer, representing **17%** of year-to-date sales, with Traton at **12%** and Volvo at **10%**[70](index=70&type=chunk) [Supporting Information and Reconciliations](index=2&type=section&id=Supporting%20Information%20and%20Reconciliations) [Non-GAAP Financial Measures](index=2&type=section&id=Non-GAAP%20Financial%20Measures) The report utilizes non-GAAP measures like Adjusted EBITDA and Free Cash Flow, with reconciliations provided for transparency - Adjusted EBITDA is defined as net income before interest, taxes, depreciation, amortization, and other adjustments not related to core operations[10](index=10&type=chunk) - Adjusted Free Cash Flow is defined as net cash from operating activities less purchases of property, plant, and equipment, plus proceeds from sales of the same[14](index=14&type=chunk) - The company has not provided a reconciliation of its forward-looking non-GAAP guidance to GAAP measures because it is not practical to project certain event-driven items[15](index=15&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) The report contains forward-looking statements subject to risks and uncertainties, advising readers to consult SEC filings - Forward-looking statements are identified by words such as "anticipates," "expects," "believes," and similar expressions[16](index=16&type=chunk)[29](index=29&type=chunk) - These statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed[16](index=16&type=chunk)[29](index=29&type=chunk) [Financial Reconciliations](index=7&type=section&id=Financial%20Reconciliations) Detailed unaudited reconciliations of GAAP to non-GAAP measures are provided for continuing and discontinued operations - Provides reconciliation of Loss from Continuing Operations before Income Taxes to Adjusted EBITDA[23](index=23&type=chunk)[24](index=24&type=chunk) - Provides reconciliation of Earnings from Discontinued Operations before Income Taxes to Adjusted EBITDA[25](index=25&type=chunk)[26](index=26&type=chunk)

Core Insights - Dana Incorporated announced its financial results for the second quarter of 2025, reflecting the Off-Highway business as a discontinued operation, which is a strategic move to focus on light- and commercial-vehicle markets [1][2] Financial Performance - Sales for continuing operations in Q2 2025 totaled $1.95 billion, a decrease from $2.05 billion in Q2 2024 [2] - Adjusted EBITDA for Q2 2025 was $145 million, representing 7.5% of sales, compared to $110 million or 5.4% of sales in Q2 2024 [3] - Loss before tax was $24 million, an improvement from a loss of $53 million in Q2 2024 [3] Cash Flow and Capital Return - Operating cash flow in Q2 2025 was $36 million, down from $215 million in Q2 2024 [4] - The company initiated a $1 billion capital return program, repurchasing over $250 million in shares during Q2 2025, with an expectation to return an additional $100 to $150 million to shareholders in Q3 2025 [2][8] Cost-Saving Initiatives - Dana's cost-savings initiative has progressed well, realizing nearly $60 million in Q2 2025 and $110 million to date, with a total target of $310 million through 2026 [2][8] - The company is raising its full-year guidance for continuing operations, reflecting higher tariff recoveries and enhanced cost performance [5] Revised Financial Guidance - Current guidance for full-year 2025 sales is projected between $7.25 billion and $7.55 billion, with adjusted EBITDA expected between $540 million and $610 million [7] - The adjusted free cash flow guidance has been increased by $50 million, now expected to be between $225 million and $325 million [9] Segment Performance - For Q2 2025, light vehicle sales were $1.335 billion, down from $1.401 billion in Q2 2024, while commercial vehicle sales decreased from $646 million to $600 million [21] - Adjusted EBITDA for light vehicles increased from $90 million in Q2 2024 to $112 million in Q2 2025, while commercial vehicle adjusted EBITDA rose from $39 million to $47 million [21] Company Overview - Dana Incorporated is a leader in designing and manufacturing propulsion and energy-management solutions, with a focus on sustainable progress and innovation [19][20] - The company reported sales of $7.7 billion in 2024 and operates in 26 countries with a workforce of 28,000 [20]

Company Overview - Dana Incorporated is a leader in designing and manufacturing efficient propulsion and energy-management solutions for vehicles and machines globally [3][4] - The company reported sales of $10.3 billion in 2024 and employs 39,000 people across 30 countries [4] - Dana has been recognized as one of the "World's Most Ethical Companies" for 2025 and one of "America's Most Responsible Companies 2025" [4] Upcoming Financial Results - Dana will release its 2025 second-quarter financial results on August 5, 2025, with a press release at approximately 7 a.m. EDT [1] - A conference call and webcast will follow at 9 a.m. EDT, where senior management will discuss the results and answer questions [1] Accessing Conference Call - The conference call can be accessed via a toll-free number for domestic participants and a toll number for international participants [2] - Audio streaming and presentation slides will be available on Dana's investor website, with a replay accessible after the call [2]

Company Overview - Dana (DAN) is expected to report a year-over-year increase in earnings of +29% to $0.40 per share, despite a revenue decline of 9.4% to $2.48 billion for the quarter ended June 2025 [3][12] - The Most Accurate Estimate for Dana is higher than the Zacks Consensus Estimate, resulting in an Earnings ESP of +10.90%, indicating a strong likelihood of beating the consensus EPS estimate [12] Earnings Expectations - The consensus EPS estimate for Dana has been revised 2.35% higher over the last 30 days, reflecting a positive reassessment by analysts [4] - The earnings report is crucial for stock movement; better-than-expected results could drive the stock higher, while a miss may lead to a decline [2][15] Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that a positive Earnings ESP reading is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1 (Strong Buy), 2 (Buy), or 3 (Hold) [10] - Dana currently holds a Zacks Rank of 2, further supporting the expectation of an earnings beat [12] Historical Performance - In the last reported quarter, Dana had an earnings surprise of -23.53%, with actual earnings of $0.13 per share compared to an expected $0.17 [13] - Over the past four quarters, Dana has beaten consensus EPS estimates two times [14] Industry Context - In the Zacks Automotive - Original Equipment industry, Lear (LEA) is expected to report earnings of $3.23 per share, reflecting a year-over-year decline of -10.3%, with revenues projected at $5.89 billion, down 2% [18] - Lear has an Earnings ESP of +0.27% and a Zacks Rank of 3, indicating a likelihood of beating the consensus EPS estimate [19]

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Core Viewpoint - Several companies are enhancing shareholder value through dividends, buybacks, and debt paydown, which can lower risk and potentially increase stock value [1][2]. Group 1: Thor Industries - Thor Industries announced a $400 million buyback program, representing approximately 8.1% of its market capitalization [2][3]. - The company has repurchased over 340,000 shares, spending over $29 million from June 6 to June 23, indicating a belief that its shares are undervalued [3]. - Thor Industries has a dividend yield of 2.2%, contributing to its overall yield generation strategy [3]. Group 2: Fair Isaac - Fair Isaac announced a $1 billion buyback program, which is about 2.2% of its market capitalization of approximately $45 billion [4][5]. - The company has increased its buyback spending to nearly $300 million per quarter over the last 12 months, suggesting a view that its shares are undervalued [5][6]. - As of July 3, Fair Isaac's stock was trading around 21% below its all-time high, with a consensus price target implying over 24% upside potential [6]. Group 3: Dana - Dana plans to reduce its debt significantly by using $2.4 billion from the sale of its off-highway business, targeting a $2 billion debt paydown, which equates to a 77% debt paydown yield [8][9]. - The company intends to allocate $1 billion for dividends and buybacks through 2027, representing over 38% of its market capitalization [9]. - Dana's current dividend yield is 2.2%, and it aims to utilize multiple pathways to generate shareholder value [9][10].

Core Insights - Investors are evaluating the attractiveness of Dana (DAN) and Ferrari (RACE) for value investment opportunities [1] - Both companies currently have a Zacks Rank of 2 (Buy), indicating positive earnings estimate revisions and an improving earnings outlook [3] Valuation Metrics - DAN has a forward P/E ratio of 11.21, while RACE has a significantly higher forward P/E of 49.17 [5] - The PEG ratio for DAN is 1.08, suggesting a more favorable valuation relative to its expected earnings growth, compared to RACE's PEG ratio of 5.53 [5] - DAN's P/B ratio stands at 1.76, indicating a lower market value relative to its book value, whereas RACE has a P/B ratio of 31.3 [6] Value Grades - Based on the valuation metrics, DAN holds a Value grade of A, while RACE has a Value grade of D, suggesting that DAN is currently the superior value option [6][7]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher," contrasting with traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Characteristics - Momentum investing can be risky as stocks may lose momentum when their valuations exceed future growth potential [2] - Investing in bargain stocks with recent price momentum may be a safer approach [3] Group 2: Stock Analysis - Dana (DAN) - Dana (DAN) has shown a four-week price change of 3%, indicating growing investor interest [4] - Over the past 12 weeks, DAN's stock price has increased by 38.9%, with a beta of 2.11, suggesting it moves 111% higher than the market [5] - DAN has a Momentum Score of A, indicating a favorable time to invest [6] Group 3: Earnings Estimates and Valuation - An upward trend in earnings estimate revisions has contributed to DAN's Zacks Rank 2 (Buy), which is associated with strong momentum effects [7] - DAN is trading at a Price-to-Sales ratio of 0.25, indicating it is reasonably valued at 25 cents for each dollar of sales [7] Group 4: Additional Investment Opportunities - Besides DAN, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen [8] - Investors can explore over 45 Zacks Premium Screens tailored to identify winning stock picks [9]

Summary of Dana (DAN) 2025 Conference Call Company Overview - Dana is a leading supplier of drivetrain and e-propulsion systems, focusing on commercial and light vehicle markets [1][16]. Key Developments - **Off Highway Divestiture**: Dana announced the sale of its off-highway business to Allison for an enterprise value of approximately $2.7 billion, expecting to net around $2.4 billion after taxes and fees [2][7]. This divestiture is seen as a strategic move to enhance shareholder value and improve the company's balance sheet [3][4]. Financial Implications - **Debt Repayment**: Dana plans to use about $2 billion from the sale proceeds to reduce its debt, targeting a net leverage of 1x over the business cycle [9][37]. - **Capital Returns**: The company announced a plan to return up to $1 billion to shareholders through 2027, with $550 million expected to be returned around the closing of the deal [10][11]. Strategic Focus - **New Dana**: Post-divestiture, Dana aims to focus on its remaining businesses, enhancing profitability and efficiency while delivering best-in-class technologies [16][17]. The company is undergoing a cost reduction program targeting $300 million in savings, with $225 million expected to be realized this year [18][19]. Market Dynamics - **Production Stability**: Dana has observed stability in production schedules for light vehicle programs, which is beneficial for converting sales into profit [30][31]. However, there is ongoing weakness in the commercial vehicle sector due to macroeconomic factors [30]. Competitive Positioning - **Hybrid and EV Opportunities**: Dana sees significant growth potential in hybrid and electric vehicle markets, emphasizing its energy source agnostic approach [50][52]. The company is well-positioned to leverage its technologies in both traditional and emerging powertrains [51][56]. Operational Efficiency - **Cost Structure Review**: Dana is actively reviewing its cost structure, particularly in SG&A, to enhance operational efficiency [20][21]. The management is focused on maintaining profitability without pursuing growth for its own sake [40][41]. Customer Relationships - **Positive Customer Response**: Customers have responded positively to the divestiture, appreciating Dana's strong balance sheet and commitment to investing in their programs [28][49]. Industry Outlook - **M&A Considerations**: While there is ongoing discussion about consolidation in the industry, Dana is currently prioritizing the optimization of its existing portfolio over new acquisitions [45][46]. Conclusion - Dana is strategically positioning itself for future growth by focusing on its core businesses, enhancing operational efficiency, and capitalizing on opportunities in the hybrid and electric vehicle markets. The divestiture of the off-highway business is a pivotal move aimed at strengthening the company's financial health and shareholder returns.