BMW: Sharp decline, strong potential for 78% increase in stock price.

Last Updated: 13. November 2023By

If I asked you to name familiar car brands, BMW would probably be one of your first answers. After all, the BMW Group is one of the world’s leading manufacturers of cars and motorcycles. BMW develops, produces and markets its products under the well-known brands BMW, Rolls-Royce Motor Cars and MINI.

Net profit down despite increasing sales In the third quarter, net profit was 2.68 billion euros, compared to 2.78 billion euros the year before. Analysts had expected net profit of 2.78 billion. Earnings per share were 4.20 euros, compared to 4.25 euros the year before. Analysts had expected 4.71 euros per share. Revenue was 38.46 billion euros, compared to 37.18 billion euros the year before. Analysts had estimated revenue at 37.47 billion euros.

Expectations for electric car sales marginally exceeded In the third quarter, the share of all-electric vehicles in total sales was 15.1%, just slightly more than BMW’s target for the full year of 15%.

Full-year forecast confirmed For the full year, the company continues to expect a return on automotive business of 9% to 10.5%. Car sales are expected to be between 5% and 10%. Free cash flow in the Automotive segment is expected to be at least 6 billion euros for the full year.

Poor chart, but ridiculously cheap valuation Conclusion: The above chart shows the ups and downs of the BMW share price this year. The beautiful uptrend from the beginning of the year was sold off again in the summer and is now in a downtrend. Can the share price go up again? 8 out of 21 analysts recommend buying, 10 want to hold and 3 analysts want to sell even at this level. The average analyst price target is 110.40. The highest analyst price target is 163 euros, which would offer you a maximum potential of 78%. In addition, as an investor you can also benefit from a dividend yield of 6.42%. A look at the valuation shows: Despite an expected decline in profits in 2024, the car share is ridiculously cheap with a P/E ratio of 4.8.