Cooper-Standard Holdings Inc. (CPS): A Bull Case Theory

We came across a bullish thesis on Cooper-Standard Holdings Inc. (CPS) on Deep Value Capital’s Substack. In this article, we will summarize the bulls’ thesis on CPS. Cooper-Standard Holdings Inc. (CPS)’s share was trading at $21.94 as of 6^th June. CPS’s trailing and forward P/E were 4.26 and 62.89 respectively according to Yahoo Finance.

Cooper Standard remains a high-upside turnaround story, albeit one whose recovery has taken longer than expected. The stock is down over 90% from its highs, but the fundamental thesis remains intact.

Since 2019, the company has aggressively restructured, removing over $600 million in structural costs while continuing to supply critical vehicle systems to top-tier original equipment manufacturers. This operational discipline, paired with its reputation, underscored by being named a General Motors Supplier of the Year for the eighth consecutive time, speaks to the strategic importance and quality of Cooper Standard’s offerings.

Despite external headwinds that have delayed its recovery, such as global supply chain disruptions and inconsistent vehicle production volumes, the company’s earnings power at normalized industry volumes remains highly attractive. If volumes were to return to prior cycle peaks, the business has the potential to deliver more than 12x returns from current levels.

This upside is driven by significant operating leverage now embedded in the business, thanks to the deep cost cuts already executed. While timing the recovery remains uncertain, the thesis centers on durability and long-term normalized profitability rather than near-term catalysts.

For long-term investors, this remains a classic deep-value setup: a mission-critical supplier with leaner operations, high customer stickiness, and asymmetric upside potential. Unless new information fundamentally alters the long-term economics of the auto supply chain or Cooper Standard’s position within it, the investment case remains a bet on mean reversion and operating leverage. The delay in realization may test patience, but it does not invalidate the thesis.

Previously, we highlighted a bullish thesis on Cooper Standard from Busy Investor Stock Reports, which emphasized the company’s dramatic cost reductions and margin recovery despite soft volumes. With revenue per vehicle rising and EBITDA expected to grow 20% even under conservative production forecasts, the thesis framed CPS as a near-term cash flow story with asymmetric upside if auto production surprises to the upside. The stock price has appreciated by approximately 39% since then.

Cooper-Standard Holdings Inc. (CPS) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 15 hedge fund portfolios held CPS at the end of the first quarter which was 14 in the previous quarter. While we acknowledge the risk and potential of CPS as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.