| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 26.37 | 1670 |
| Intrinsic value (DCF) | 1.09 | -27 |
| Graham-Dodd Method | n/a | |
| Graham Formula | n/a |
NN, Inc. (NASDAQ: NNBR) is a diversified industrial company specializing in high-precision components and assemblies for critical applications across multiple industries. Headquartered in Charlotte, North Carolina, NN operates through two key segments: Mobile Solutions and Power Solutions. The Mobile Solutions segment serves the automotive and general industrial markets with components for power steering, braking, transmissions, and HVAC systems. The Power Solutions segment provides precision metal and plastic components for electrical, aerospace, defense, and medical sectors, including orthopedics and surgical tools. Founded in 1980, NN, Inc. plays a vital role in industries requiring exacting tolerances and reliability, positioning itself as a key supplier in industrial and automotive supply chains. With a focus on innovation and engineering excellence, NN caters to demanding applications where performance and durability are paramount.
NN, Inc. presents a high-risk, high-reward investment opportunity due to its exposure to cyclical industrial and automotive markets. The company's negative net income (-$38.3M) and diluted EPS (-$1.11) in the latest fiscal year raise concerns, though its operating cash flow ($11.1M) suggests some underlying operational strength. With a high beta of 2.159, NNBR stock is significantly more volatile than the broader market. The lack of dividends and substantial debt ($197M against $18.1M cash) further increase risk. However, its niche in precision components for critical applications could position it well for recovery in industrial and automotive sectors. Investors should weigh its potential in electrification and aerospace against its current financial challenges.
NN, Inc. competes in the precision components market by focusing on high-tolerance, application-critical products where engineering expertise differentiates suppliers. Its Mobile Solutions segment benefits from long-standing relationships with automotive OEMs, though it faces pricing pressure from larger suppliers. The Power Solutions segment's strength lies in its diversified end markets (aerospace, medical), which provide some insulation from automotive cyclicality. However, NN's relatively small scale ($464M revenue) limits its bargaining power against both customers and suppliers. The company's competitive advantage stems from its technical capabilities in complex metal and plastic components, but it lacks the vertical integration or brand recognition of larger competitors. Its financial constraints may hinder R&D and capacity investments compared to better-capitalized peers. The shift toward electric vehicles presents both a risk (reduced demand for traditional automotive components) and opportunity (new precision part requirements).