Founder, BWS Financial Inc

Hamed Khorsand

Founder

Independent Stock Specific Research

BWS Financial Inc

BWS provides independent stock specific research focused on companies with distinct value that are going through a special situation where there is a tangible catalyst not priced in. The catalyst can be anything from new product, restructuring, M&A, management change, change in business strategy, etc. BWS’s focus is to understand the change and evaluate the potential return for investors.

BWS utilizes a self formed proprietary approach in discovering stocks by putting great emphasis on deep research. BWS does generate short recommendations following a similar criteria.

Equity Bottom-Up

<ul type="disc"><li>
Garrett Motion (GTX, GTXAP) was not immune to the production curtailments within the auto industry. GTX reported second quarter results showing a decline in the number of turbocharger units sold in the quarter while average selling price (“ASP”) rose.</li></ul> <ul type="disc"><li>Automakers have been focusing on producing their highest margin vehicles at a time when semiconductors are in short supply to meet industry demand. The change in product mix allowed GTX to report an increased gross margin and operating margin.</li></ul> <ul type="disc"><li>The demand environment for vehicles has increased resulting in lowered channel inventory. Automakers have stated they expect the tight inventory environment could remain until 2023. At the same time, new car models are being introduced and GTX is winning greater share of light vehicles in the US with its new gasoline turbochargers.</li></ul> <ul type="disc"><li>We have made changes to our earnings model after GTX updated its guidance for the year. We believe GTX is taking a cautious tone reflecting the chip shortage causing automakers to reduce production in the near-term.</li></ul>


Garrett Motion (GTX, GTXAP) was not immune to the production curtailments within the auto industry. GTX reported second quarter results showing a decline in the number of turbocharger units sold in the quarter while average selling price (“ASP”) rose. Automakers have been focusing on producing their highest margin vehicles at a time when semiconductors are in short supply to meet industry demand. The change in product mix allowed GTX to report an increased gross margin and operating margin. The demand environment for vehicles has increased resulting in lowered channel inventory. Automakers have stated they expect the tight inventory environment could remain until 2023. At the same time, new car models are being introduced and GTX is winning greater share of light vehicles in the US with its new gasoline turbochargers. We have made changes to our earnings model after GTX updated its guidance for the year. We believe GTX is taking a cautious tone reflecting the chip shortage causing automakers to reduce production in the near-term.

<ul type="disc"><li>We are initiating coverage of Garrett Motion (GTX) with a Buy Rating and $15 target.</li></ul> <ul type="disc"><li>
Garrett Motion (GTX, GTXAP) has emerged from bankruptcy protection with fewer distractions and focus on growing market share in turbochargers for automobiles.</li></ul> <ul type="disc"><li>GTX filed for Chapter 11 bankruptcy to settle outstanding asbestos claims that were part of a business Honeywell (HON) owned but was part of the GTX spin-off. GTX no longer has such indemnity exposure and has a simplified agreement in paying HON.</li></ul> <ul type="disc"><li>Continued growth in gasoline turbochargers creates a catalyst for sales growth over the next three years.</li></ul> <ul type="disc"><li>GTX’s development of its e-turbo turbocharger and fuel cell compressor gives GTX exposure to hybrid and fuel cell vehicles solidifying a long runway to grow sales beyond gasoline and diesel.</li></ul> <ul type="disc"><li>GTX’s stock is trading at a discount to peers and where the shares were prior to its financial issues even though the sales growth is likely to have linear characteristics for the next couple years.</li></ul>

We are initiating coverage of Garrett Motion (GTX) with a Buy Rating and $15 target. 
Garrett Motion (GTX, GTXAP) has emerged from bankruptcy protection with fewer distractions and focus on growing market share in turbochargers for automobiles. GTX filed for Chapter 11 bankruptcy to settle outstanding asbestos claims that were part of a business Honeywell (HON) owned but was part of the GTX spin-off. GTX no longer has such indemnity exposure and has a simplified agreement in paying HON. Continued growth in gasoline turbochargers creates a catalyst for sales growth over the next three years. GTX’s development of its e-turbo turbocharger and fuel cell compressor gives GTX exposure to hybrid and fuel cell vehicles solidifying a long runway to grow sales beyond gasoline and diesel. GTX’s stock is trading at a discount to peers and where the shares were prior to its financial issues even though the sales growth is likely to have linear characteristics for the next couple years.

GTX: Motion for Commotion, Initiating with Buy

Switzerland

Garrett Motion Inc. operates as an automobile technology provider. The Company offers turbocharging, electric boosting, and automotive software solutions. Garrett Motion serves customers worldwide.

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Garrett Motion (GTX US)

GTX: Clarity in Motion

GTX updated their guidance to reflect the current OEM order environment in a worst case scenario, which should allow investors to value the shares...

BWS Financial Inc

GTX: Motion for Commotion, Initiating with Buy

GTX has recently emerged from Chapter 11 protection with a stronger financial foundation and a business that has several years of sales growth....

BWS Financial Inc

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