Red Flag Note- Autoliv, Inc. (ALV)
Evidence a key tailwind is about to reverse
Autoliv (ALV) reported non-GAAP EPS of $1.58 in 1Q24, beating the consensus estimates by 18 cps. However, we noticed an unsustainable accounting-related benefit and although it did not account for the entire beat, we see compelling evidence that this benefit will reverse and eat into growth in upcoming quarters.
As with all Red Flag Notes, we caution that this report does not represent a full earnings quality review of the company. We may perform more work on ALV and will follow up with any additional concerns that arise.
Now, let’s get behind the numbers…