- Tenneco had a better than expected second quarter, but worries about weaker second-half build-rates and increasing cost/supply chain pressure are weighing on the shares.
- This company is vulnerable to vehicle electrification, especially in passenger vehicles, but management hopes to offset this with active suspension components, steady aftermarket sales, and commercial vehicle revenue growth.
- Management has improved the cost structure already, but there are multiple product division-level self-improvement projects still underway, and further deleveraging would be significant for valuation/sentiment.
- Tennceo is definitely not my favorite parts supplier, but expectations seem low enough that management has real opportunities to outperform.
For further details see:
Tenneco's Shares Getting Dragged Down By Macro Concerns