AI Stock Memo: DAN - Dana - RankAlpha

DAN

AI Memo

Dana

As of 2026-04-29/Confidence medium

Open ticker Back to Memos

Data freshness

AI Memo

As of 2026-04-29 • Model: RankAlpha Sentiment Codex

Decision Panel

Action, confidence, horizon, and decision blockers at a glance.

Action

—

Confidence

medium

Horizon

—

Key catalyst

Q1 print showed margin expansion, maintained 2026 guidance, and a new Stellantis program win • 2026-04-29

Expected move: -0%

Biggest risk

The bear read is that the market still discounted the release on day one, implying skepticism about the quality or durability of the quarter. Q1 operating cash flow was a use of $156 million and adjusted free cash flow was a use of $195 million, while Dana's own 10-K frames 2026 against declining global market demand and cyclical customer production, so a single strong quarter may not be enough to de-risk the year. [#8-K-2026-04-29] [#10-K-2026-02-27]

Invalidation

Break below $31 or thesis failure.

What would change my mind?

The bull read is that Q1 showed real operating improvement: sales rose 5% year over year, adjusted EBITDA improved by $78 million, margin expanded 400 basis points, the Off-Highway sale is complete, and management still held full-year guidance while adding a Stellantis program win and citing a roughly $950 million three-year backlog. That supports a case that restructuring, portfolio simplification, and cost discipline are starting to translate into a more durable earnings base. [#8-K-2026-04-29]

Research note

Recommendation

—

Confidence

medium

As of

2026-04-29

Base target

$36

p=45%

Bull target

$41

p=25%

Bear target

$31

p=30%

Key bullets

Fast scan of bull, bear, and watch items

BullKey bullets

Immediate market reaction was negative despite the solid headline release
2026 setup still depends on execution against soft end-market conditions
The bull read is that Q1 showed real operating improvement: sales rose 5% year over year, adjusted EBITDA improved by $78 million, margin expanded 400 basis points, the Off-Highway sale is complete, and management still held full-year guidance while adding a Stellantis program win and citing a roughly $950 million three-year backlog.

BearKey bullets

Dana's 10-K says customer production is cyclical and volatile, so weaker OEM schedules could pressure the maintained 2026 outlook.
[#10-K-2026-02-27]
Negative first-quarter operating cash flow and adjusted free cash flow mean the margin improvement still needs to convert into cash generation.

WatchKey bullets

Q1 print showed margin expansion, maintained 2026 guidance, and a new Stellantis program win

Summary

High-level snapshot

Recommendation

Model confidence

medium

Timeframe

Asset

Equity

Trigger

Base case: $36 (p=45%)

Bull/Bear spread: +13% / -14%

Vs latest close: Bull +13% · Base -0% · Bear -14%

Scenario probabilities

Bull Target: $41 (p=25%)Base Target: $36 (p=45%)Bear Target: $31 (p=30%)

Commentary

Primary evidence quality is high because the April 29, 2026 8-K and attached earnings release were confirmed directly, but this is still a T+1 earnings follow-up and post-print analyst revision coverage was not available in the reviewed materials. The tone is therefore cautious: the company delivered a clearly better quarter and maintained guidance, yet the immediate price reaction was negative, which argues for a monitoring stance rather than treating the print as a clean rerating trigger.

As of 2026-04-29 • Updated bi-weekly / post-earningsSource: Internal modelMethodology

Analyst Summary

Thesis highlights from the latest analysis

Bull Case

Bear Case

Drivers

Scannable catalysts and supporting factors

Immediate market reaction was negative despite the solid headline release
2026 setup still depends on execution against soft end-market conditions

Scenarios

Bull Target (Scenario probability)

$41 / p=25% prob

Base Target (Scenario probability)

$36 / p=45% prob

Bear Target (Scenario probability)

$31 / p=30% prob

Price $36 as of 2026-05-28

Nearest Scenario: Base (∆ 0%)

Targets vs latest close: Bull +13% · Base -0% · Bear -14%

Sentiment & Exposure

News Sentiment (30d)

-0.20

Social Sentiment (7d)

0.00

Events

Other notable items detected

EVENT2026-04-29
Q1 print showed margin expansion, maintained 2026 guidance, and a new Stellantis program win
Dana's April 29, 2026 earnings release reported Q1 sales of $1.87 billion, adjusted EBITDA of $171 million with a 9.2% margin, maintained full-year guidance of $750 million to $850 million adjusted EBITDA and $250 million to $350 million adjusted free cash flow, and disclosed a new Stellantis RAM Dakota award that lifts the three-year net new sales backlog to about $950 million. This is constructive, but it is still an early T+1 read and needs follow-through in cash generation and subsequent quarters. [#8-K-2026-04-29]
Prob 75.00% • Move 6.00% • Priced-in 55.00%

Short-term Catalysts

Next few weeks

Immediate market reaction was negative despite the solid headline release
2026-04-29
DAN closed at $37.63 on April 28, 2026 and traded at $35.82 on April 29, 2026, a roughly 4.7% decline from the prior close. The negative same-day reaction suggests investors are not fully crediting the EBITDA improvement and maintained guidance yet, likely waiting for better proof on demand durability and cash-flow conversion.
Prob 70% • Move -5% • Priced-in 65%

Long-term Catalysts

Months to a year

2026 setup still depends on execution against soft end-market conditions
2026-12-31
Dana's 2025 10-K said its 2026 outlook assumes declining global market demand, partly offset by about $200 million of net new business backlog, dissipation of tariff-recovery lag, and currency tailwinds; the filing also warns that customer production is cyclical and volatile and that tariff and raw-material pressures can affect results. That keeps the medium-term thesis tied to sustained cost savings, mix, and volume execution rather than a clean macro recovery. [#10-K-2026-02-27]
Prob 65% • Move 8% • Priced-in 50%

Risks

Dana's 10-K says customer production is cyclical and volatile, so weaker OEM schedules could pressure the maintained 2026 outlook. [#10-K-2026-02-27]
Negative first-quarter operating cash flow and adjusted free cash flow mean the margin improvement still needs to convert into cash generation.
The 10-K also flags tariff exposure, raw-material cost swings, and some single-source supply dependencies, which can offset pricing and productivity gains. [#10-K-2026-02-27]
The same-day share decline after earnings indicates execution credibility remains fragile; if later analyst revisions do not improve, the stock may struggle to rerate even with maintained guidance.

Peers

Symbol	Summary
PHIN	PHINIA is the closest operating peer in the packet because both companies have propulsion-related exposure and OEM drivetrain content, making it a more useful read-through on margin and program execution than broader auto-component names.
VC	Visteon shares OEM auto exposure and vehicle-production sensitivity, but its electronics-heavy mix makes it only a partial peer for Dana's driveline and axle portfolio.
GT	Goodyear overlaps on cyclical auto and replacement-market demand, but the product set is less direct, so it is better used as a broad end-market barometer than a tight valuation comp.

Sources

Internal and external references used in this analysis

Model source: RankAlpha Sentiment Codex
Analysis date: 2026-04-29