Value
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 2.6 |
| P/S | 9.9 |
| EV/EBITDA | 7.7 |
| Fwd P/E | 9.1 |
| PEG | 10.0 |
| Analyst target | 5.0 |
- ▸Forward P/E: 11.4x
- ▸PEG: 0.04
- ▸Attractively valued
THRM · Why this verdict
Why Gentherm (THRM) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.6/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The stock shows a thin upside margin of just 4.2%, limiting the reward available even if the thesis plays out. Bear case | The upside margin should widen above 10% for the risk/reward to become more compelling over 12 months. | →Stable |
| CounterA thin upside margin on an attractively valued stock with strong cash conversion may still be worth holding for income and stability rather than pure capital appreciation. | ||
Gentherm trades at an attractive valuation with a forward P/E of 11.1x and an unusually low PEG ratio of 0.03, suggesting the stock is cheap relative to its growth. Valuation breakdown | The forward P/E should stay below 15x or the stock should re-rate upward toward peer multiples as growth continues over 12 months. | →Stable |
| CounterAn extremely low PEG of 0.03 can also reflect unreliable or overly optimistic growth estimates baked into the calculation, rather than a genuine bargain. | ||
The stock triggered a death cross that the engine treats as a hard block, alongside failed momentum at 3.1 versus a 4.5 threshold and failed asymmetry at 0.5 versus a 1.5 threshold. Engine gate (failed) | The death cross should resolve with price reclaiming the 200-day moving average and momentum rising above 4.5 over the next several months. | →Stable |
| CounterThe momentum notes also describe the current RSI of 33 as an uptrend pullback and buy opportunity, suggesting the death cross may be a lagging signal on an otherwise recovering trend. | ||
Gentherm has posted consecutive earnings misses in 2 of the last 4 quarters, feeding bear-case concerns about execution. Bear case | The company should post a beat with positive surprise at the next report on 2026-07-23. | →Stable |
| CounterThe strong cash conversion at 441% of FCF-to-net-income and a Piotroski F-Score of 8 out of 9 suggest underlying fundamentals remain healthy despite the earnings misses. | ||
The stock shows a thin upside margin of just 4.2%, limiting the reward available even if the thesis plays out.
→StableBear case
- Expectation
- The upside margin should widen above 10% for the risk/reward to become more compelling over 12 months.
CounterA thin upside margin on an attractively valued stock with strong cash conversion may still be worth holding for income and stability rather than pure capital appreciation.
Gentherm trades at an attractive valuation with a forward P/E of 11.1x and an unusually low PEG ratio of 0.03, suggesting the stock is cheap relative to its growth.
→StableValuation breakdown
- Expectation
- The forward P/E should stay below 15x or the stock should re-rate upward toward peer multiples as growth continues over 12 months.
CounterAn extremely low PEG of 0.03 can also reflect unreliable or overly optimistic growth estimates baked into the calculation, rather than a genuine bargain.
The stock triggered a death cross that the engine treats as a hard block, alongside failed momentum at 3.1 versus a 4.5 threshold and failed asymmetry at 0.5 versus a 1.5 threshold.
→StableEngine gate (failed)
- Expectation
- The death cross should resolve with price reclaiming the 200-day moving average and momentum rising above 4.5 over the next several months.
CounterThe momentum notes also describe the current RSI of 33 as an uptrend pullback and buy opportunity, suggesting the death cross may be a lagging signal on an otherwise recovering trend.
Gentherm has posted consecutive earnings misses in 2 of the last 4 quarters, feeding bear-case concerns about execution.
→StableBear case
- Expectation
- The company should post a beat with positive surprise at the next report on 2026-07-23.
CounterThe strong cash conversion at 441% of FCF-to-net-income and a Piotroski F-Score of 8 out of 9 suggest underlying fundamentals remain healthy despite the earnings misses.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Gentherm looks cheap on valuation and cash-conversion metrics, but a death cross the engine treats as a hard block, alongside failed momentum and asymmetry gates and consecutive earnings misses, keeps the setup unattractive for now.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 1.1 |
| ROA | 3.4 |
| Gross margin | 0.8 |
| Op margin | 3.3 |
| Net margin | 0.7 |
| Current ratio | 6.9 |
| FCF quality | 10.0 |
| Moat | 5.6 |
| Piotroski F | 8.9 |
- ▸Excellent cash conversion: 441% FCF/NI
- ▸Strong Piotroski F-Score: 8/9
Growth
5.3/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 5.3 |
Momentum
2.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 5.0 |
| Volume | 1.3 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-MA but MA slope flat
Sentiment
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 7.4 |
| erm sentiment | 5.0 |
Insider
7.5/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
- ▸Institutions accumulating
Peer rank
4.8/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.4 |
| quality rank | 3.0 |
| growth rank | 6.6 |
Technical
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 7.2 |
| support resistance | 6.9 |
| 52w position | 7.5 |
Risk (lower is worse)
5.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.8 |
| days to cover | 7.2 |
| volatility | 2.9 |
| put call | 6.7 |
| implied vol | 1.1 |
| max pain risk | 3.0 |
| beta | 5.5 |
| debt equity | 8.5 |
- ▸High IV: 73%
- ▸Above max pain $30
- ▸Concentration risks: 2 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 9.7 |
- ▸Earnings concerns: 2B/2M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (5)
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:16d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:2.6<4.5
- ASYMMETRY:0.3<1.5@spot
- DEATH_CROSS:HARD_BLOCK
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
0.31
Upside
+2.4%
Downside
7.7%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeInst Constrain — Small cap ($1.1B) below institutional reach
SuitabilityAggressive — Beta 1.38>1.3, MCap $1.1B<$5B
Investment implication
The F-path SELL output reflects an overall score of 5.6 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 7.5) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:2.6<4.5, ASYMMETRY:0.3<1.5@spot, DEATH_CROSS:HARD_BLOCK) reinforce the read. Current asymmetry R:R is 0.31 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 7.5, Insider at 7.5, and Technical at 7.2; the weakest are Momentum at 2.6, Quality at 4.5, and Peer rank at 4.8. The V9 engine flagged 3 failed gates with 1 warning, producing an asymmetric reward-to-risk of 0.31 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Attractive Valuation Low Peg
Trip ifForward P/E rises above 18x or PEG ratio exceeds 1.0.
- P2Death Cross Hard Block
Trip ifPrice reclaims and stays above the 200-day moving average for 2 consecutive months with momentum rising above 4.5.
- P3Consecutive Earnings Misses
Trip ifCompany posts a beat with surprise above 5% at the 2026-07-23 report.
- P4Thin Upside Margin
Trip ifUpside margin widens above 10%.