Schaeffler: Cheap Valuation Justifies The Turnaround Execution Risks

The Global Investor 2.23K Followers Follow Summary Schaeffler AG is executing a multi-year turnaround, leveraging the Vitesco merger to hedge against auto sector uncertainty and diversify revenue streams. SFFLY targets profitability improvements through cost cuts, selective bidding, portfolio streamlining, and synergies, while maintaining exposure to both ICE and BEV technologies. Despite lowering E-Mobility revenue and margin targets, SFFLY reaffirmed group-level EBIT margin and free cash flow targets for 2028, signaling resilience in its strategic hedges. SFFLY stock valuation remains attractive with a forward EV/EBITDA of 5.4x, offering upside as restructuring progresses and exposure to China and aftermarket segments grows. Michael H/DigitalVision via Getty Images Schaeffler AG ( SFFLY ) is a small-cap German automobiles and parts company listed on the Frankfurt Stock Exchange. It has four segments: E-Mobility, Powertrain & Chassis, Vehicle Lifetime Solutions, and Bearings & Industrial Solutions. I like the company, as it has started a sensible turnaround This article was written by The Global Investor 2.23K Followers Follow The Global Investor has 4.5/5 stars on TipRanks and is in the top 12% of financial bloggers as of July 2026. I cover common stocks and REITs. My background is in equity long/short fund management, energy trading, credit trading and technology. Bachelor's in Financial Engineering. Master's in Finance. Lived and worked in six countries, hence the global. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in SFFLY over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.