Dauch Has Lost 36% Since February: BWS Financial Sees 194% Upside

Key Takeaways

• Dauch closed at $5.79 on Oct. 7, 36% below its February high, and BWS Financial reiterated its Buy rating and $17 target on Oct. 5, 194% above that close.

• The Dowlais acquisition nearly doubled Dauch’s quarterly sales, but its interest expense more than doubled, and GM’s pickup changeover was expected to cut production from September.

• Analysts expect normalized EPS to rise from $0.53 in fiscal 2025 to $1.48 in fiscal 2028, and every Street target is above the share price.

• BWS’s $17 target implies 17.2x forward earnings against 5.9x today, so the call is plausible but stretched, and the $9 consensus is the more reasonable target.

Dauch Corporation (DCH:NYSE) closed at $5.79 on Oct. 7, 36% below its Feb. 4 high. On Oct. 5, BWS Financial’s Hamed Khorsand reiterated his Buy rating and $17 price target, 194% above that close.

What sank it

The high came the day after Dauch closed its Dowlais acquisition, and the costs showed up fast. Second-quarter 2026 sales nearly doubled to $2.96 billion from $1.54 billion a year earlier, but interest expense more than doubled to $89.8 million from $43.1 million. With $148.7 million of restructuring and acquisition costs, Dauch lost $99.3 million in the first half of 2026.

The shares bottomed at $5.09 on July 8. A strong second quarter followed on Aug. 7. But on the call, CFO Chris May warned that the next-generation pickup launch at General Motors (GM:NYSE), Dauch’s largest customer, would bring “customer production downtime and related volume impacts,” starting in September.

Then on Sept. 22, Jefferies’ Vanessa Jeffriess cut the stock to Hold, citing “slowing momentum following a strong 1H” as the GM changeover hits.

(Over 12 months, the stock is flat: the drop is a round trip from February.)

BWS hasn’t budged

Khorsand has held $17 through the whole slide: TIKR’s high target has been $17 since Jan. 27. That makes BWS the Street’s outlier. The next-highest recent target is TD Cowen’s $10, and on Oct. 7 UBS trimmed its target to $8 from $9 while keeping its Buy.

Does $17 add up?

The rest of the Street sees less upside. The consensus target is $9, and even the low target, $7, is above the price.

The earnings estimates point the same way. Analysts expect normalized EPS of $0.97 for fiscal 2026, up from $0.53 in fiscal 2025 with Dowlais in the numbers, then $1.16 in fiscal 2027 and $1.48 in fiscal 2028.

The multiple is the hard part. Dauch trades at 5.9x forward earnings.

The five-year average of 25.6x isn’t much of a guide: with expected earnings near zero at times, the multiple swung from -131.1x to 2,537.0x.

$5.79 ÷ 5.87x is about $0.99 of expected earnings a share over the next 12 months. Divide $17 by that, and BWS’s target implies 17.2x forward earnings, against 5.9x today.

So is Dauch a $17 stock?

The near-term risk is GM’s changeover. Dauch’s guidance also assumes no changes to USMCA, which is under review.

BWS’s call is plausible but stretched. The direction is right: estimates rise every year through 2028, every target is above the price, and [5.9x] is a low price for that growth. But $17 needs the market to pay [17.2x] for an auto supplier that carried $5.03 billion of long-term debt at June 30, and no other recent target tops $10. The $9 consensus is the more reasonable bar.

What could change that: Dauch’s Capital Markets Day on Nov. 17 and its third-quarter report, the first with the GM changeover in it. A path to earnings well beyond $1.48 a share would make $17 easier to defend.

So what is Dauch stock actually worth?

TIKR lets you forecast the future price of any stock in less than a minute. Just enter a few assumptions into TIKR’s valuation model and see what Dauch could be worth. Start from Wall Street consensus estimates, or adjust the inputs to reflect your own view of the business. It’s free to use.

Value Dauch for free