Stellantis NVSTLA has given investors quite a ride in the past year, with shares surging by a whopping 44%. Compare this with rivals Ford Motor Co F, which faced a 2.7% decline, and General Motors Co GM which saw a loss of 11%. What sets Stellantis apart?
With famous brands like Chrysler, Dodge, Citroen, Fiat, and Alfa Romeo under its umbrella, Stellantis has carved a unique path in the auto industry.
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Complex But Strong
Stellantis prides itself on a wide range of mass-market models and a well-received lineup of electric vehicles, particularly in Europe. Setting ambitious targets, the company aims for 100% of its European sales and 50% of U.S. sales to be battery electric vehicles by the end of the decade.
Despite its complex structure, with multi-national brands and primary stock listings in Paris, Milan, and New York, and a 6% stake held by the French government, CEO Carlos Tavares has steered the company to achieve strong margins and quality earnings.
In the first half of 2023, revenues were up 14% to $50.6 billion off a 7% increase in shipments.
Great Expectations
What’s in store from Stellantis on Thursday? While U.S. carmakers faced challenges, including a month-long strike by auto workers union members in the fourth quarter, both Ford and General Motors reported forecast-beating fourth-quarter results. Can Stellantis continue the trend?
Expectations highlight Stellantis’ full-year earnings per share at $5.69, a 1.6% increase from the previous year. Revenues are anticipated to reach $200 billion for the full year, marking a 5.7% increase from 2022.
With a net cash expectation of around $32 billion and research and development costs seen at 7% of sales, it seems Stellantis is well-positioned. Investors may also be hoping for positive news on shareholder returns.
“Stellantis management should soon shift to returning capital to shareholders at a more aggressive pace and may soon announce a significant share buyback program or a special dividend,” said Scott Olson, analyst at Seeking Alpha.
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