Linamar provides an exceptional mix of strong profit generation and exposure to multi-year secular tailwinds in both hybrid and electric propulsion. With over 90% of its sales unaffected by current tariff frameworks, the company has proven adept at navigating supply disruptions while capturing market share from less capitalized competitors.
The stock trades at just 7.7 times the company’s forward earnings forecast. That’s low and suggests the market is over-discounting short-term industrial cyclicality. As agricultural equipment inventories bottom and newly secured mobility programs reach volume production, multiple expansion toward 10x earnings would provide considerable upside for patient investors.
LINAMAR CORP. (Toronto symbol LNR; www.linamar.com) makes a variety of automotive parts, including cylinder heads and cylinder blocks. It also makes self-propelled, scissor-type work platforms under the Skyjack brand, and agricultural harvesting equipment.
The company has two main businesses: the Mobility division (75% of revenue in the latest quarter, 71% of earnings) makes a variety of automotive parts, including transmissions, cylinder heads and cylinder blocks; and the Industrial division (25%, 29%) makes self-propelled, scissor-type work platforms under the Skyjack brand, as well as its agricultural harvesting equipment line.
Linamar currently operates 87 manufacturing plants in 19 countries. Customers in Canada account for 40% of its revenue, followed by the rest of North America (30%), Europe (23%) and Asia (7%).
Linamar is also benefiting from recent acquisitions. In December 2025, it paid $42.89 million for a facility in Leipzig, Germany, from Switzerland-based industrial company Georg Fischer. This plant makes iron castings for commercial vehicles, as well as construction, forestry and agricultural equipment.
Linamar also recently agreed to buy two factories in Germany from Winning BLW. These facilities make gears and other components for a variety of vehicles.
The purchase nicely complements Linamar’s existing operations in Germany. What’s more, they already supply gears to some of the company’s current European customers.
Linamar has not yet said how much it will pay for these assets. However, they will add $200 million to its annual revenue of about $10.2 billion and immediately add to its earnings.
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Linamar’s high manufacturing volumes drive double-digit top line surge
In the three months ended June 30, 2026, Linamar’s sales rose 18.8%, to $3.14 billion from $2.64 billion a year earlier. That beat the consensus forecast of $2.47 billion.
Sales of automotive equipment (75% of the total) rose 20.5% on new product launches and acquisitions. Sales of industrial products (25%) also improved 13.8% as stronger demand for Skyjack equipment offset lower sales of agricultural equipment.
If you factor out foreign exchange gains and unusual items, earnings in the quarter improved 8.7%, to $183.0 million from $168.4 million. Linamar spent $58.6 million on share buybacks in the first six months of 2026, which is why earnings per share improved at a faster rate of 9.6%, to $3.08 from $2.81. However, that missed the consensus estimate of $3.12.
For all of 2026, Linamar will probably earn $11.86 a share and the stock trades at an attractive 7.7 times that estimate. The company has also raised your quarterly dividend by 10.3%. Starting with the September 2026 payment, investors now receive $0.32 a share instead of $0.29. The new annual rate of $1.28 dividend yields 1.4%.
The collapse of the most recent round of trade negotiations between Canada and the U.S., as well as uncertainty over the broader Canada-U.S.-Mexico trade agreement (CUSMA), adds risk for auto part makers like Linamar. However, the company has a long history of successfully adapting to changing tariffs and technologies. Moreover, it’s hard for automakers to shift to alternative suppliers, which should further cushion any tariff impact.
Recommendation in The Successful Investor: Linamar Corp. is a buy for long-term gains.
