Today’s idea:
Gentherm shares down ~60% over the last 5 years
RMT transaction closes Oct 1, combining Gentherm’s light auto business with a mostly commercial & off-highway business from Modine
Post-close shares trade at 7.4x EBITA (before synergies) with <1x leverage and a $400m buyback authorization (20% of market cap)
For new subscribers — these write-ups are meant to be a “jumping off point” for the idea generation process (i.e. a surface level review). Each write-up includes: (1) company background; (2) why the idea is interesting; and (3) fair value estimate.
Check out past write-ups here and my home base page here.
Recent write-ups include:
09/21/26 — A look at the Corteva / Vylor spin-off
09/15/26 — Guide to investing in M&A situations ($)
09/09/26 — Deckers Outdoor busted GARP story
09/01/26 — Microcap compounder at Rave Restaurant ($)
08/25/26 — Cal-Maine is a clean P/B mean reversion idea
Quick Value
Gentherm (THRM)
Ticker: THRM
Price: $35
Shares: 55m (pro-forma)
Market cap: $1.93bn (pro-forma)
Valuation: 7.4x EBITDA (pro-forma)
Theme: spin-off (RMT)
Last week, I looked at the Corteva/Vylor spin-off which is set to begin trading on October 1st. Another “spin” is scheduled to start trading that same day…
Technically, this is a Reverse Morris Trust (RMT) transaction where Modine is spinning off a division and simultaneously merging it with publicly traded Gentherm (THRM). So it’s part M&A, part spin-off.
Here are my notes…
