(BFM Bourse) – The Sino-British bank underlines that weak sales to individuals and slow destocking in the United States augur a less good first half than the consensus anticipates.
The biggest increase in the CAC 40 last year, Stellantis is undoubtedly experiencing a stock market downturn. Since the end of March, the stock has returned more than 30%.
The car manufacturer resulting from the merger between Fiat Chrysler and Peugeot SA in early 2021 warned that its current operating margin would reach between 10% and 11% in the first half, compared to 14.4% a year earlier, while pointing to a difficult market in Europe. Investors are also concerned about the group’s inventory levels in the United States, where Stellantis is losing market share.
The group had also addressed the subject during its day dedicated to investors on June 13. The manufacturer had tried to reassure the market, specifying in particular that stocks of models no longer in production had decreased by 19% between May and April, and that stocks in number of days of sales had been reduced by 11 days over the same period.
The car manufacturer is still suffering on the stock market this Thursday. The stock dropped 3.6% around 3:25 p.m. after losing up to 4.4% during the day.
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Dull volumes
A Parisian analyst believes that this decline may be linked to an HSBC rating. In this document, the Sino-British bank lowered its price target on Stellantis to 22 euros compared to 23.5 euros previously, confirmed its “hold” advice, and reduced its revenue and current operating profit forecasts for 2024.
Above all, the bank is reporting a tougher first part of the year than expected. “Weak” personal sales and slow “destocking” in the United States “suggest that the first half of 2024 will be more difficult than consensus expects,” she writes.
By extrapolating the volumes observed in April and May to those of June, HSBC calculates a decline of 4% compared to the previous quarter, while the consensus anticipates an increase of 6% in deliveries over this same period.
Losses of market share put into perspective
On the brighter side, HSBC contextualizes the significant market share losses in North America and Europe, emphasizing that “much of the pain has been self-inflicted.”
This is because Stellantis has optimized its model portfolio, with significant vehicle withdrawals. In other words, the appeal of the group’s brands has not been undermined, especially since “the models which prevailed (in the Stellantis portfolio) held their place well in terms of market share”, underlines the bank . Which bodes well for future launches, she adds.
Stellantis is due to launch a total of 25 models in 2024, and the group is counting on the ramp-up of these new products to obtain better financial results in the second half of the year than in the first.
“Stellantis’ next phase of profit growth depends on the success of new product launches (of which there are many) and the group’s ability to overcome the sluggish markets of North America and Europe. “This is normal business, but market share losses have been the group’s Achilles’ heel over the past two years,” concludes HSBC.
Stellantis will release its first half results on July 25.
Julien Marion – ©2024 BFM Bourse
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