Dana Incorporated Off Highway Business Divestiture Update Summary Company Overview - **Company**: Dana Incorporated (DAN) - **Event**: Off Highway Business Divestiture Update Conference Call - **Date**: June 12, 2025 Key Points Industry and Transaction Details - Dana announced the sale of its Off Highway business to Allison Transmission Holdings for an enterprise value of **$2.7 billion** [6] - The transaction is structured as a **100% cash deal** and is expected to close in **late Q4 2025**, subject to regulatory approvals [10][11] - The sale is expected to generate approximately **$2.4 billion** in net proceeds after liabilities, fees, taxes, and separation costs [10] Financial Implications - The sale allows Dana to achieve a **7x multiple** on the expected Off Highway 2025 adjusted EBITDA, capturing value not reflected in its stock price [7] - Dana plans to use about **$2 billion** of the proceeds to pay down debt, targeting a net leverage ratio of **1x** over the business cycle [11][17] - A total capital return of **$1 billion** to shareholders is planned through **2027**, with **$550 million** expected to be returned around the closing time [11][18] Business Focus Post-Divestiture - Post-transaction, Dana will focus on two main business segments: **light vehicle** and **commercial vehicle systems**, emphasizing leadership in both traditional internal combustion engine (ICE) and electrification technologies [13] - The aftermarket business is projected to contribute **10-12%** of total sales, providing a higher EBITDA margin profile [14] Cost Reduction and Financial Performance - Dana is on track with a **$300 million** cost savings plan, with **$225 million** expected to be realized this year [20][21] - The company anticipates generating **$225 million** in free cash flow for the year, aligning with estimates [20] - Adjusted EBITDA margins are expected to reach **10-10.5%** in 2026, with ongoing margin improvement initiatives [21][49] Market Outlook - North American commercial vehicle demand is expected to soften, while light vehicle demand remains stable [19] - The company is experiencing a decline in tariff exposure, which is becoming less of a risk [20] - Dana's backlog includes a robust pipeline of new business opportunities in both light and commercial vehicle segments [22] Shareholder Returns and Capital Allocation - The return of capital to shareholders will be executed through dividends and opportunistic share repurchases, with a focus on maintaining a conservative balance sheet [17][18][44] - The company is committed to returning **$1 billion** to shareholders, which represents approximately **40%** of its market cap [17] Additional Insights - The retained Off Highway business, generating about **$130 million** in sales, is expected to have marginal EBITDA contributions [59] - Dana's electrification strategy is being reassessed to align with market realities, with a focus on improving near-term cash flow [24][85] - The company is not heavily focused on regional market dynamics but rather on product capabilities and customer needs [93][96] Conclusion Dana Incorporated's divestiture of its Off Highway business marks a significant strategic shift aimed at enhancing shareholder value and focusing on core business segments. The transaction is expected to strengthen the company's balance sheet, improve financial flexibility, and position Dana for future growth in the light and commercial vehicle markets.

Core Viewpoint - Wells Fargo has issued an "overweight" rating for Dell Technologies (DELL.US) with a target price of $150, representing a 30% upside from the current stock price, despite recent concerns regarding potential cost-cutting measures by the U.S. federal government [1][2] Group 1: Financial Performance and Projections - Dell's projected total revenue from federal contracts in 2024 is approximately $3.04 billion, with 56% from defense contracts and 44% from civilian contracts, reflecting a 15% year-over-year increase from $1.82 billion in 2022 [1] - For the fiscal year 2025, Dell's commercial revenue is estimated at $43.89 billion, with about 70% derived from the U.S., and approximately 10% of U.S. commercial revenue related to federal government contracts, indicating a risk exposure of around $3 billion in personal computer business related to the federal government [1] Group 2: Market Position and Strategic Outlook - Wells Fargo's positive outlook on Dell is based on the company's execution of deleveraging and its shift towards capital return initiatives, including share buybacks and dividends [2] - The bank also views Dell's ability to leverage its supply chain economies of scale favorably, highlighting the attractiveness of its long-term risk/reward profile due to its diverse investment portfolio and depth in hardware and software [2]

Financial Data and Key Metrics Changes - Adjusted operating earnings for the first quarter of 2025 were $376 million, reflecting a 13% increase compared to the previous year [5][13] - Adjusted operating earnings per share rose over 20% year-over-year, reaching $5.2, up from $4.16 in the prior year's first quarter [6][16] - The estimated Risk-Based Capital (RBC) ratio increased to 585%, well above the minimum requirement of 425% [29] Business Line Data and Key Metrics Changes - Retail annuity sales exceeded $4 billion, marking a more than 9% increase from the previous year [7] - Sales of variable annuities grew by 9% year-over-year, totaling $2.7 billion, with a notable 40% increase in sales of variable annuities without living benefits [7][8] - Fixed and fixed indexed annuity sales showed meaningful growth, although at a moderated level compared to the second half of the previous year [9] Market Data and Key Metrics Changes - Advisory sales increased by 28% compared to the first quarter of 2024, with an annual run rate exceeding $1 billion [10] - The average retail annuity assets under management (AUM) rose to $246 billion, up from $242 billion in the first quarter of 2024 [19] Company Strategy and Development Direction - The company aims to maintain a disciplined approach to growth, focusing on both organic and inorganic opportunities, including potential acquisitions in the annuity business [38] - Jackson is committed to product innovation and expanding distribution channels, particularly through financial professionals at JPMorgan Wealth Management [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating market volatility, emphasizing the importance of providing security to Americans planning for retirement [11][33] - The company remains focused on delivering flexible protection and income-oriented solutions, which are increasingly valued during uncertain market conditions [12] Other Important Information - The company returned over $230 million to common shareholders in the first quarter, with a cash dividend of $0.80 per share approved for the second quarter [10][11] - The hedging program reported a consolidated net hedge loss of $134 million, but the overall strategy has provided stability in capital generation [20][22] Q&A Session Summary Question: Interest in acquiring in the annuity business - Management acknowledged past successful acquisitions and stated that future opportunities would be evaluated against the value of share buybacks or balance sheet strengthening [38] Question: Strategy regarding spread-based products - Management indicated that they are actively evaluating competitiveness and pricing strategies while maintaining discipline in their approach to spread products [41] Question: Fee-based advisers selling more annuities - Management highlighted the importance of providing choice to advisers and the growth of modeling and financial planning tools that support both fee-based and commission structures [50]

Financial Data and Key Metrics Changes - Adjusted operating earnings for the first quarter of 2025 were $376 million, reflecting a 13% increase compared to the previous year [5][14] - Adjusted operating earnings per share rose over 20% year-over-year, with reported earnings per share at $5.1, adjusted to $5.2 after accounting for notable items, marking a 25% increase from $4.16 in the prior year's first quarter [6][17] - The estimated Risk-Based Capital (RBC) ratio increased to 585%, well above the minimum requirement of 425% [29] Business Line Data and Key Metrics Changes - Retail annuity sales exceeded $4 billion, up more than 9% from the previous year, with variable annuities sales increasing by 9% to $2.7 billion [7][18] - Sales of the RILA product reached $1.2 billion, supporting diversification in top-line growth [18] - Advisory sales increased by 28% year-over-year, with an annual run rate exceeding $1 billion [11] Market Data and Key Metrics Changes - The company reported a healthy and profitable book of business, generating excess capital and maintaining a strong liquidity position with over $600 million in holding company liquid assets [11][30] - The company noted that the demand for variable annuity products remains strong, particularly among retiring Americans seeking asset growth and guaranteed income [8] Company Strategy and Development Direction - The company aims to continue delivering on its financial targets while positioning itself for long-term profitability, with a focus on the annuity industry and providing flexible protection and income-oriented solutions [12][34] - The company is open to evaluating inorganic growth opportunities, emphasizing the importance of comparing potential acquisitions to share buybacks and balance sheet strengthening [40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating market volatility, highlighting the effectiveness of their hedging program in stabilizing capital generation [25][32] - The company remains committed to serving financial professionals and their clients, focusing on helping Americans grow and protect their retirement savings [36] Other Important Information - The company announced a second-quarter cash dividend of $0.80 per common share, reflecting its commitment to returning capital to shareholders [12] - The company reported a consolidated net hedge loss of $134 million in the first quarter, but noted that their hedging program has provided stability in non-operating results [21][22] Q&A Session Summary Question: Interest in acquiring in the annuity business - Management acknowledged past successful bolt-on acquisitions and stated that any future opportunities would be evaluated against the value of share buybacks or balance sheet strengthening [40] Question: Strategy regarding spread-based products - Management indicated that they approach the market with discipline and are open to ideas and opportunities to enhance competitiveness, while noting growth in sales of spread products [43][44] Question: Fee-based advisers selling more annuities - Management highlighted the importance of providing choice to advisers and the growth of the RIA space, emphasizing the development of modeling and financial planning tools for fee-based advisers [52][53] Question: Impact of capital in April at Brook Re - Management described the impact as modest and reiterated their focus on maintaining sufficient capital above regulatory levels [58][60] Question: Sensitivity to market rates and potential capital contributions - Management explained that scenarios requiring capital contributions would involve high volatility combined with deep equity stress, similar to past financial crises [68][70]

Financial Data and Key Metrics Changes - The company reported a net income of $145 million for the first quarter, with a return on equity of 12.6% and an 11% year-over-year increase in book value per share to $32.48 [6][13] - Adjusted diluted net operating income per share was $0.99, slightly lower than the previous quarter's $1.08 [13] - Total revenues for the quarter were $318 million, a slight increase from the previous quarter [14] Business Line Data and Key Metrics Changes - The primary mortgage insurance in force reached $274 billion, benefiting from an 86% persistency rate due to elevated interest rates [7][15] - New insurance written in the first quarter was $9.5 billion, lower than the previous quarter due to a smaller origination market [15] - The in-force premium yield remained stable at 38 basis points [16] Market Data and Key Metrics Changes - The private mortgage insurance market has been relatively flat at approximately $300 billion over the past two years [10] - The company expects the housing market in 2025 to align with recent years, supported by ongoing supply shortages and pent-up demand from first-time homebuyers [10] Company Strategy and Development Direction - The company continues to focus on capital and expense management, with a strategic emphasis on share repurchases as an attractive use of capital [6][8] - A multi-year quota share reinsurance arrangement was agreed upon to mitigate risk and provide capital relief [26] - The company aims to maintain strong liquidity and capital flexibility while returning value to shareholders [10][27] Management's Comments on Operating Environment and Future Outlook - Management expressed a positive outlook for the housing market and mortgage insurance business, despite uncertainties from global trade policies [11][12] - The company is closely monitoring the impact of financial market volatility on its business [11] - Management remains conservative in its credit loss expectations, maintaining a default rate expectation in the sub-3% range [32][34] Other Important Information - The company repurchased $27 million worth of shares during the quarter, representing over 4% of shares outstanding [8][24] - Operating expenses decreased by 12% from the previous quarter, totaling $77 million [22] - The company expects to pay up to $795 million in total distributions to Radian Group in 2025 [24] Q&A Session Summary Question: Update on credit loss expectations and pricing strategies - Management noted strong performance in default and cure trends, with a default rate of 2.33%, lower than the previous quarter [32][34] Question: Drivers behind the claims rate reduction - The claims rate was reduced from 8% to 7.5% based on positive cure trends and home price appreciation [36][37] Question: Insights on buybacks and capital return philosophy - The company accelerated share buybacks significantly this quarter, utilizing excess liquidity to capture value [40][41] Question: Level of embedded equity in new delinquencies - Approximately 75% of new defaults have more than 20% equity, contributing to strong cure performance [46] Question: Right level of Holdco liquidity - The company maintains a strong liquidity position, currently at $834 million, and plans to return capital to shareholders as opportunities arise [50][52]

Summary of Truist Financial Corporation Conference Call Company Overview - **Company**: Truist Financial Corporation - **Participants**: Mike Maguire (CFO) Key Points Management Changes - Beau's contributions over 20 years were acknowledged as he steps down, with Mike Maguire and others taking on his responsibilities [2][3] - Focus on aligning wholesale payments with enterprise payments to enhance market strategy [3][4] Industry Positioning - Increased optimism in the banking industry noted, with Truist positioned to capitalize on this momentum [5] - Strong capital position allows for elevated shareholder returns and growth across various business lines [6][8] Loan Growth Expectations - Anticipation of loan growth across most sectors, with caution in commercial real estate due to current market conditions [9][10] - Specialty lending businesses in consumer sectors are performing well, indicating a positive outlook for growth [11][14] Deposit and Interest Income Outlook - Stable deposit environment compared to previous year, with expectations for deposit growth aligned with loan growth [16][17] - Net interest income (NII) outlook is contingent on the interest rate curve, with a productive curve expected [19][20] Investment Portfolio Management - Increased investment portfolio size from approximately $115 billion to $125 billion, with future growth expected to be more measured [22][23] - Focus on managing risks associated with interest rate fluctuations through swaps [24] Fee Income Growth - Investment banking and trading have shown consistent growth, with a focus on expanding market share and improving profitability [25][26] - Emphasis on enhancing treasury and wholesale payments as a key area for growth [28][30] Expense Management - Commitment to limiting expense growth to 1.5% in 2025 while investing in growth initiatives [36][40] - Ongoing efficiency initiatives from late 2023 are expected to yield benefits into 2025 [37] Asset Quality and Risks - Commercial real estate exposure is manageable, with proactive measures in place to mitigate risks [42][44] - Monitoring of economic factors such as tariffs and tax cuts is ongoing, with no significant updates on asset quality [45] Capital Management - Strong capital position allows for continued stock buybacks and growth investments [46][48] - Prioritization of growth, dividends, and buybacks in capital deployment strategy [51][52] Market Opportunities - Identified growth opportunities in existing markets like Texas, Pennsylvania, and New Jersey, focusing on increasing market share [56] - Mid-teens return on tangible common equity (ROTCE) target set, with ongoing initiatives to achieve this goal [57][58] Conclusion - Truist is positioned for growth with a clear focus on execution, capital management, and enhancing profitability through strategic initiatives [67][68]

Financial Data and Key Metrics Changes - The company reported a net income of $131 million, with a return on assets of 19.1% and a return on equity of 18.8%, which compares favorably with peers and industry averages [6][7] - The net income was impacted by a non-recurring rental expense adjustment of $810,000, which equated to approximately $0.42 on an after-tax basis [7] - Loan growth for the year was 7%, while deposit growth was 3.6%, both moderate compared to previous years but in line with industry averages [7][8] - Non-performing loans decreased from $20 million to $10 million, representing a 50% improvement [9] - The leverage capital ratio improved from 10.85% at the beginning of the year to 11.33% at year-end [11] - Tangible book value per common share increased from $50.54 to $57.86 [11] Business Line Data and Key Metrics Changes - The company experienced a reduction in criticized loans by 33% during the year [9] - The company repurchased 460,000 shares of common stock for a total consideration of $34 million [11] Market Data and Key Metrics Changes - The company noted that the banking industry is experiencing slow growth, with no significant increases in activity anticipated in the near term [7][8] - The company is facing competition from local banks offering special rates, particularly in the Asian community [22] Company Strategy and Development Direction - The company plans to remain flexible in its pricing strategy to compete effectively in the market [22] - The management indicated that buybacks will depend on loan growth prospects, stock pricing, and capital ratios [23] - The company is establishing a new branch in Manhattan, expected to open in March 2025, which will increase occupancy and personnel expenses [47] Management's Comments on Operating Environment and Future Outlook - Management expressed a cautious outlook for the banking industry, expecting moderate growth [7][45] - The management highlighted that while there is still activity, payoff activity has been higher, indicating a lack of sustainable increases in loan activity [46] - The management noted that clients are currently hesitant to invest due to perceived risks, despite having capital available [62] Other Important Information - The company plans to make a significant donation to local wildfire relief efforts, which will increase donation expenses [30] - The company is actively purchasing treasuries to take advantage of favorable rates, with $60 million in ten-year treasury purchases made recently [50] Q&A Session Summary Question: Inquiry about margin stability - Management indicated that they do not foresee major effects on margins and expect them to remain relatively stable [16][17] Question: Capital repatriation and buyback plans - Management stated that buyback decisions will depend on loan growth prospects and stock pricing, with a possibility of continued buybacks if stock remains undervalued [23] Question: Spot rate on deposits - The spot rate on deposits was reported at 3.63% for December [28] Question: Expense run rate expectations - Management projected non-interest expenses at about $23 million for the upcoming year, including increased charitable contributions and elevated payroll taxes [30][31] Question: Loan growth and competitive landscape - Management noted elevated payoff activity and a lack of sustainable increases in loan activity, indicating a cautious outlook for future growth [42][45] Question: Health of borrowers and credit trends - Management reported that borrowers are generally healthy, with strong sponsors willing to support loans during challenging times [66][70]