Here's Why You Should Offload American Axle Stock From Your Portfolio

Core Viewpoint - American Axle & Manufacturing Holdings, Inc. (AXL) faces significant challenges due to expected declines in North American light vehicle production, high capital expenditures, and elevated debt levels, suggesting a potential sell recommendation for investors [1][2]. Group 1: Sales and Production Outlook - AXL anticipates sales between $5 billion and$6.05 billion for 2025, a decrease from $6.12 billion in 2024, primarily due to expected declines in North American light vehicle production [2]. - The company heavily relies on major automakers, with GM accounting for 42$300 million in 2025 from $242 million in 2024 to develop technologically advanced products, which may affect cash flow [3]. - As of December 31, 2024, AXL's net long-term debt was$2.58 billion, with cash and cash equivalents at $552.9 million, resulting in a total debt-to-capital ratio of 0.81, significantly higher than the industry average of 0.25, limiting financial flexibility [4]. Group 3: Growth Strategies - AXL is pursuing growth through electrification strategies, including a partnership with Inovance and recent product launches in electric propulsion, while also targeting$1.5 billion in new opportunities [6]. - The company is optimizing its portfolio through acquisitions, such as the Metaldyne acquisition, and plans to divest its India commercial axle unit, which is expected to enhance focus and financial strength [6].