Adient plc Faces Potential Tax Asset Restrictions Due to Ownership Changes
Adient plc faces potential restrictions on using tax assets due to ownership changes, impacting its financial health. Sections 382 and 383 of the Internal Revenue Code may limit its ability to offset post-change income and taxes. This poses a risk to its fiscal strategy, compounded by similar state tax laws. Wall Street rates ADNT stock as Moderate Buy.
Adient plc (ADNT) has disclosed a new risk, in the Accounting & Financial Operations category.
TipRanks Black Friday Sale
- Claim 60% off TipRanks Premium for the data-backed insights and research tools you need to invest with confidence.
- Subscribe to TipRanks' Smart Investor Picks and see our data in action through our high-performing model portfolio - now also 60% off
Adient plc faces potential limitations on its ability to utilize pre-change net operating loss carryforwards and other tax attributes due to ownership changes, as outlined in Sections 382 and 383 of the Internal Revenue Code. An ownership change, defined by a cumulative shift exceeding 50 percentage points in ‘5% shareholders’ over three years, could restrict Adient’s capacity to offset post-change income and taxes, impacting its financial health. Such restrictions could adversely affect Adient’s business, financial condition, operating results, and cash flows, posing a significant risk to its fiscal strategy. This risk is compounded by similar state tax laws that could further limit the use of these tax assets.
Overall, Wall Street has a Moderate Buy consensus rating on ADNT stock based on 4 Buys, 1 Sell and 4 Holds.
To learn more about Adient plc’s risk factors, click here.
