OPmobility: gas return

(Boursier.com) — OPmobility signs the day’s decline on the Parisian market this Tuesday, with a stock which falls by almost 7% to 8.25 euros. A development which appears severe after the very good performance of the automotive supplier in the third quarter. In a context of a decline in automobile production of -4.8% over the period, linked in particular to delays in the start of production in a context of progressive electrification and high inventories, OPmobility outperformed the market by +9.5 points and posted an economic turnover of 2.746 billion euros, up +3.6% (+4.7% organically), mainly driven by the Modules and Exterior business groups. Unlike many of its competitors, the group has confirmed its 2024 outlook, i.e. turnover outperforming the market and an improvement in all financial aggregates compared to 2023 (operating margin, net profit Group share, free cash flow and net debt). Among the latest broker opinions, Bernstein has started to cover the value at ‘underperformance’ with a target of only 7.20 euros in a market considered adverse, whose change is far from over… Compared to peers (Valeo, lost), for TP ICAP Midcap, the latest publication was considered particularly reassuring insofar as: OPmobility maintains its guidance (outperformance of its markets and improvement of all the group’s financial aggregates); manages to generate positive organic growth; does not underperform its market in China (a sign of a repositioning in favor of local manufacturers already well carried out by YFPO). The broker is therefore ‘buying’ the stock with a price target of 15 euros.

Morgan Stanley (‘overweight’) estimates that sales exceeded its expectations by 1.9%, with a “healthy outperformance” compared to the production of light vehicles. The bank also highlights the company’s optimistic comments, particularly on the strength of the key American market. Finally, if the forecasts remain rather unambitious, the absence of warning on profits has reassured… Finally, after the very cautious message from Valeo, this publication is likely to reassure, noted Oddo BHF. On the one hand, the strong outperformance observed in Q3 (clear progress after an already solid H1 at +3.5 pts) should allow OPmobility to meet its 2024 financial objectives without too much difficulty (undoubtedly greater comfort than the most peers). On the other hand, the message from management did not seem particularly more cautious than in recent weeksdispelling the idea of ​​a sudden recent deterioration suggested by Valeo. More generally, it seems that this publication and this exercise should perfectly reflect the strengths of OPM in a difficult context, whether on a commercial level (strong outperformance) but also on costs (SG&A, industrial) and financial discipline (generation of FCF best-in-class). Thus, the broker reiterates its ‘outperformance’ opinion on OPmobility, estimating that the course is still well maintained by management in an environment which remains generally adverse…