Raising Tenneco's FVE to $61 from $57 on Effective Tax-Rate Change
We have raised our fair value estimate on the shares of narrow-moat-rated Tenneco by $4, to $61. Morningstar now believes that tax reform under the Trump administration is more likely than not. We assumed a 25% statutory corporate tax rate on Tenneco’s U.S. pretax income, down from the current tax rate of 35%. Despite our fair value increase, the shares of Tenneco remain 3-star-rated. Currently trading at a slight 1% discount to our $61 fair value, we view the shares of Tenneco as reasonably pri...Tenneco designs, manufactures and sells products and services for light vehicle, commercial truck, off-highway, industrial and aftermarket customers. As a parts supplier, the company produces individual component parts for vehicles as well as groups of components that are combined as modules or systems within vehicles. These parts, modules, and systems are sold to the light vehicle and commercial truck manufacturers as well as aftermarket customers, including independent warehouse distributors, distributors, engine rebuilders, retail parts stores, mass merchants, and service chains. The company operates in four segments, consisting of the following: Clean Air, Powertrain, Motorparts, and Ride Performance.
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Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
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