Garrett Motion Inc is scored 26 for moat and 80 for management. The management score rests on a return on invested capital of 38.1% and a gross margin of 24.5% — figures that describe a business turning capital into profit efficiently. Shareholder equity is negative, so the debt-to-equity figure is not meaningful here — usually the mark of heavy buybacks rather than distress, but worth checking. A narrow moat alongside exceptional management is a combination worth understanding before the price matters at all.
Three independent anchors set the price worth paying. Growth is modelled at 3.4% a year, the rate measured from the filings. The exit multiple assumed is 8.0x. That produces an intrinsic value of $5.05, a 10-CAP price of $20.36 and a payback time price of $18.98, with the value zone set at the highest of the three, $20.36. Today's price of $26.25 is 29% above it.
The price is above the value zone and the business scores 26 for moat and 80 for management. Neither test argues for paying up here.
| Price | $26.25 |
| Market cap | $4.9B |
| P/E ratio | 14.3x |
| Return on invested capital | 38.1% |
| Gross margin | 24.5% |
| Debt to equity | -1.88x |
| Free cash flow yield | 9.8% |
| Growth rate used | 3.4% |
| Growth rate measured | 3.0% |
| Exit multiple assumed | 8.0x |
| Company | Moat | Buy price |
| Gentex Corp (GNTX) | 66 | $29.05 |
| Lkq Corp (LKQ) | 43 | $26.89 |
| Lear Corp (LEA) | 50 | $216.77 |
| Autoliv Inc (ALV) | 79 | $134.26 |
Every number above is built on assumptions that can be changed. In Moatly you can move the growth rate, the exit multiple and the margin of safety and watch every figure recalculate, so you are testing your own view of Garrett Motion Inc rather than accepting ours.