DETROIT -- TRW Automotive Inc.'s stock price is down nearly 30 percent since its initial public offering in February.
Demand is growing for the type of occupant-safety products that TRW produces, but the supplier's heavy dependence on the Big 3 has left it exposed to price-cut demands and lower volume.
"We expect TRW to benefit from increasing demand for automotive safety products," Efraim Levy, a Standard & Poor's analyst, said in a recent re-port. "But we see profit margins continuing to lag behind those of peers."
These should be the best of times for the giant supplier in the booming occupant-safety business, which is estimated at $12 billion annually. Growth in this segment - which includes items such as airbags, seat belts, tire-pressure monitors and antilock brakes - is being fueled by increased voluntary and legislated use of safety equipment.
But TRW's share price has underperformed the Standard & Poor's Auto Parts & Equipment Index. The 2004 index was down 10.9 percent through Aug. 6. TRW's IPO of 24 million shares closed at $27.10 a share after the first day of trading on Feb. 3. The shares closed at $19.46 on Thursday, Sept. 2. The company has a market capitalization of $1.93 billion.