Autoliv, Inc. (ALV), based in Stockholm, Sweden, is a holding company that operates through two principal subsidiaries: Autoliv AB (AAB) and Autoliv ASP (ASP). The company manufactures occupant restraint systems for automobiles and has a product portfolio consisting primarily of safety airbags, seat belts and steering wheels.

Difficult conditions in North American and West European automotive markets are of primary concern for the company. Moreover, pricing pressure from OEMs and higher raw material costs have stalled margin expansion.

Currently, Autoliv shares are trading at 5.5x our 2008 EPS estimate of $3.35. The company's revenue and earnings improvements are being offset by the market weaknesses and pricing pressure. This makes us cautious and compels us to rate the stock a Sell. We set a target price of $14.00, which is 4.2x our 2008 estimate.