Magna International (NYSE:MGA) Posts Quarterly Earnings Results, Beats Expectations By $0.33 EPS

Magna International (NYSE:MGA) (TSE:MG) released its earnings results on Friday. The company reported $1.86 EPS for the quarter, topping the consensus estimate of $1.53 by $0.33, Briefing.com reports. Magna International had a net margin of 1.60% and a return on equity of 14.01%. Magna International’s revenue for the quarter was up 3.3% compared to the same quarter last year. During the same period in the previous year, the firm posted $1.44 earnings per share. Magna International updated its FY 2026 guidance to 6.700-7.300 EPS.

Here are the key takeaways from Magna International’s conference call:

• Strong Q2 performance: Sales rose 3% with weighted organic growth 3% above market, while adjusted EBIT increased 16%, margin expanded 70 basis points to 6.2%, and adjusted EPS reached a record $1.86, up 29% year over year.
• Magna raised its 2026 outlook, including adjusted EBIT margin of 6.3%–6.6%, adjusted EPS of $6.70–$7.30, and free cash flow of approximately $1.8 billion. Management cited strong first-half execution, operational excellence, and improved working capital performance.
• Cash generation and shareholder returns strengthened: Q2 free cash flow more than doubled to $617 million, while the company returned $598 million to shareholders and plans to repurchase its remaining roughly 9 million shares under the current authorization by early November.
• Management highlighted continued bookings and technology wins, including an 800-volt, two-speed e-drive program with Chery and a driver and occupant monitoring system with a European OEM; more than 90% of expected 2028 business is already booked.
• Risks remain from weaker China production, shifting market share toward Chinese OEMs, program end-of-production events, commodity inflation, trade-policy uncertainty, and modest unrecovered DRAM and tariff-related costs in the second half.

Magna International Price Performance

MGA stock traded down $1.19 during trading on Friday, reaching $68.66. 2,480,569 shares of the company were exchanged, compared to its average volume of 1,645,983. The company has a debt-to-equity ratio of 0.38, a quick ratio of 0.88 and a current ratio of 1.22. The stock’s 50 day moving average price is $65.75 and its 200 day moving average price is $60.97. Magna International has a 52-week low of $40.51 and a 52-week high of $70.36. The company has a market cap of $18.36 billion, a P/E ratio of 28.73, a PEG ratio of 0.94 and a beta of 1.44.

Institutional Investors Weigh In On Magna International

A number of hedge funds and other institutional investors have recently modified their holdings of MGA. Russell Investments Group Ltd. grew its holdings in shares of Magna International by 7.8% in the 4th quarter. Russell Investments Group Ltd. now owns 2,090,887 shares of the company’s stock worth $111,549,000 after acquiring an additional 151,819 shares during the period. Public Employees Retirement System of Ohio raised its holdings in Magna International by 196.9% during the third quarter. Public Employees Retirement System of Ohio now owns 139,659 shares of the company’s stock worth $6,620,000 after purchasing an additional 92,613 shares during the last quarter. Ameriprise Financial Inc. boosted its position in Magna International by 14.2% during the second quarter. Ameriprise Financial Inc. now owns 56,868 shares of the company’s stock worth $2,196,000 after purchasing an additional 7,073 shares in the last quarter. Danske Bank A S acquired a new stake in Magna International in the third quarter valued at $112,000. Finally, Atlas Capital Advisors Inc. acquired a new stake in Magna International in the fourth quarter valued at $67,000. 67.49% of the stock is currently owned by institutional investors and hedge funds.

Analyst Ratings Changes

A number of equities research analysts recently commented on the stock. Canadian Imperial Bank of Commerce reduced their price objective on shares of Magna International to $74.00 in a research report on Monday, May 4th. Scotiabank boosted their target price on Magna International from $72.00 to $74.00 and gave the stock a “sector outperform” rating in a research report on Monday, July 20th. Weiss Ratings raised Magna International from a “hold (c)” rating to a “hold (c+)” rating in a research note on Wednesday. The Goldman Sachs Group reduced their price target on Magna International from $60.00 to $52.00 and set a “sell” rating for the company in a report on Tuesday, April 14th. Finally, Citigroup lifted their price target on Magna International from $58.00 to $75.00 and gave the company a “buy” rating in a research note on Thursday, June 4th. One research analyst has rated the stock with a Strong Buy rating, eight have assigned a Buy rating, ten have issued a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat, the stock presently has a consensus rating of “Hold” and an average price target of $65.73.

Trending Headlines about Magna International

Here are the key news stories impacting Magna International this week:

• Positive Sentiment: Q2 results exceeded expectations. Adjusted EPS was a record $1.86, versus the $1.53 consensus estimate and $1.44 a year earlier. Sales rose 3% to $11.0 billion despite a 2% decline in global light-vehicle production. Magna Q2 Earnings and Revenues Top Estimates
• Positive Sentiment: Profitability improved sharply. Adjusted EBIT increased 16% to $677 million, while the adjusted EBIT margin expanded to 6.2% from 5.5%. Management cited productivity initiatives, restructuring benefits, higher organic sales, favorable foreign-exchange impacts and tariff recoveries. Magna Announces Strong Second Quarter Results
• Positive Sentiment: Full-year profitability and cash-flow targets were raised. Magna now expects 2026 adjusted EPS of $6.70-$7.30, up from $6.25-$7.25, adjusted EBIT margin of 6.3%-6.6%, and free cash flow of $1.75-$1.85 billion. The company also returned $598 million to shareholders in Q2 through dividends and share repurchases. Magna Q2 2026 Financial Review
• Neutral Sentiment: Revenue guidance was reduced to $41.3-$42.5 billion from $41.5-$43.1 billion, primarily because of unfavorable currency translation and the earlier completion of divestitures. The reduction does not reflect weaker operating expectations, but it could temper investor enthusiasm.
• Negative Sentiment: Magna continues to face lower production in North America, Europe and China, unfavorable product mix, customer price concessions and higher commodity costs. Six-month reported net income and GAAP EPS also declined year over year, partly because of substantially higher other expenses and amortization.

About Magna International

Magna International Inc is a leading global automotive supplier specializing in the design, engineering, and manufacturing of vehicle systems, assemblies, modules, and components. Headquartered in Aurora, Ontario, the company partners with major original equipment manufacturers (OEMs) to develop technologies and solutions that enhance vehicle performance, safety, comfort, and fuel efficiency. Magna’s broad portfolio encompasses body exteriors and structures, powertrain systems, seating and interiors, roof systems, mirror systems, and advanced driver assistance systems (ADAS).

The company operates more than 350 manufacturing and assembly facilities and over 100 innovation centers across 27 countries, serving customers in North America, Europe, Asia, South America, and Africa.