Grimes & Company Inc., a well-known investment firm based in the United States, has significantly increased its stake in the auto parts giant Lear Corporation (NYSE: LEA), a move that has caught the attention of global investors. According to a recent filing with the U.S. Securities and Exchange Commission (SEC), Grimes & Company expanded its holding by a sizeable 68.3% during the first quarter of the year, purchasing an additional 32,019 shares. This brings their total shareholding to 78,917 shares, now valued at approximately USD $6.96 million (roughly AUD $10.5 million), giving them 0.15% ownership of the company.
Why This Matters
Lear Corporation isn’t just another auto parts supplier—it’s a global heavyweight with operations across North America, Europe, Africa, Asia, and South America. The company designs and manufactures automotive seating and electrical distribution systems for many of the world’s leading car manufacturers. With the auto industry shifting rapidly due to innovations in electric vehicles (EVs) and autonomous driving technologies, investment decisions like this signal growing confidence in companies that are poised to adapt and evolve.
For Australian investors keeping an eye on the global auto sector, Grimes & Company’s move is a notable one. It highlights that despite market fluctuations, established firms like Lear continue to be viewed as valuable long-term investments.
Other Big Investors Also Taking Notice
Grimes & Company isn't the only one strengthening its position in Lear. Other investment firms have also made strategic moves:
- Addison Advisors LLC increased their Lear stake by 68.2% in the last quarter of 2024, now holding 338 shares.
- Quadrant Capital Group LLC raised its holding by over 51% and now owns 491 shares.
- Putney Financial Group LLC entered the market with a new Lear position in Q4 2024.
- Fifth Third Bancorp more than doubled its holdings in Q1 2025, increasing to 765 shares.
- EverSource Wealth Advisors LLC posted a dramatic 247.1% increase in its position during the last quarter of 2024.
Institutional investors now hold a whopping 97.04% of Lear’s shares, a figure that reflects substantial confidence from major market players.
How is Lear Performing?
On Tuesday, Lear’s stock price dropped slightly, falling by $1.90 to settle at $90.68 per share. While this minor dip might seem concerning, it’s essential to view it within the broader market context. Lear’s stock still boasts solid fundamentals:
- Current Ratio: 1.32
- Quick Ratio: 1.02
- Debt-to-Equity: 0.59
- Market Capitalisation: USD $4.85 billion (AUD $7.3 billion)
- P/E Ratio: 10.14
- PEG Ratio: 0.49
- Beta: 1.29 (indicating moderate volatility)
The stock has seen highs of USD $126.85 and lows of USD $73.85 in the past 12 months. With its current position around the mid-range, there could be growth potential, especially if Lear continues to outperform earnings expectations.
Recent Earnings Beat Expectations
Lear released its quarterly earnings on May 6, 2025, reporting an earnings-per-share (EPS) of USD $3.12. This was a healthy surprise for investors, beating analysts’ consensus estimate of USD $2.64 by nearly 50 cents.
Here are a few key takeaways from the earnings report:
- Revenue: USD $5.56 billion (AUD $8.4 billion), slightly exceeding analyst projections of USD $5.47 billion.
- Net Margin: 2.17%
- Return on Equity: 14.70%
- Year-over-Year Comparison: EPS dropped slightly from $3.18 last year, while revenue declined 7.2%, likely due to global supply chain and production challenges.
Nevertheless, this earnings beat and strong return metrics reflect solid operational efficiency, even amid a challenging economic backdrop.
Dividends: What You Need to Know
For dividend-focused investors—especially retirees or income-focused Aussies—Lear’s upcoming dividend is a point of interest. The company has declared a quarterly dividend of USD $0.77 per share, payable on June 25th. That amounts to an annualised dividend of USD $3.08, with a current yield of approximately 3.40%.
To be eligible, investors needed to be on record by June 5th, and the ex-dividend date was the same. This payout rate suggests Lear is committed to returning value to shareholders, even in a time when many corporations are slashing dividends to conserve cash.
What Do Analysts Think?
Lear has received mixed reviews from analysts recently:
- Wall Street Zen upgraded the stock to a “Buy” rating in mid-May.
- TD Cowen and Cowen downgraded Lear from “Buy” to “Hold” earlier in the year.
- Bank of America is bullish, raising its price target from USD $110 to $115.
- UBS Group is taking a neutral stance, increasing their price target to $95 from $83.
Overall, the consensus rating sits at “Hold”, with an average price target of USD $107.09. This suggests modest upside from current levels, depending on how Lear performs in the second half of the year.
Inside Scoop: Executive Sell-Off
There was some notable insider activity in June. Board director Conrad L. Mallett, Jr. sold 1,187 shares at an average price of USD $92.86, netting over $110,000. After this sale, he now only holds 84 shares—a 93% reduction in personal holdings.
While insider sales can sometimes raise eyebrows, they don’t always indicate negative sentiment. Directors often sell for various reasons, including tax planning or personal needs, and the broader institutional investment patterns still suggest faith in the company’s direction.
About Lear Corporation
For those unfamiliar, Lear Corporation is an industry leader in manufacturing high-quality automotive seating and electrical systems. Their products are installed in a range of vehicles—from compact cars to SUVs and pickup trucks. The company operates globally and partners with several top automotive brands.
Lear’s Seating Segment includes everything from seat mechanisms and foams to premium leather and fabric trim, while its E-Systems Division focuses on advanced electrical distribution, connectivity, and software for EVs and smart cars.
Final Thoughts for Australian Investors
For Australians looking to diversify their portfolios internationally—especially in the booming auto tech space—Lear Corporation offers a compelling case. Grimes & Company’s substantial investment, paired with strong institutional backing and decent dividend yields, paints a positive picture.
With the auto sector undergoing significant transformation thanks to electrification and digitalisation, companies like Lear that offer essential components to a wide range of vehicle manufacturers may continue to thrive. Keeping an eye on upcoming earnings, global auto trends, and supply chain dynamics will be key for investors moving forward.
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Mitchell
Mitchell is a seasoned Ph.D. scholar with extensive expertise gained through years of rigorous research, publication, and teaching experience. He brings a wealth of knowledge and analytical skills to tackle complex academic challenges. His work is dedicated to delivering innovative solutions, advancing knowledge, and promoting academic excellence. Proficient in research methodology, data analysis, and scholarly writing, Mitchell has contributed to peer-reviewed journals and mentored students to achieve academic success.
