Smaller companies from Germany are usually referred to as secondary values, which are only worth a few hundred million dollars. Traton, however, is different. The secondary value from the S-DAX belongs to the circle of the 50 largest German companies. The company has a market value of 9.5 billion euros, making it more valuable than Zalando, Qiagen, Siemens Energy or Covestro.

The fact that Traton is listed only in the S-DAX is due to the low share of freely tradable shares, as VW holds 90% of the shares. Until 2018, Traton was still known as Volkswagen Truck and Bus. Traton thus combines the Volkswagen subsidiaries in the commercial vehicle sector. The most famous brands include Scania and MAN, which also account for two thirds of sales. The rest of the sales is generated mainly in Latin and North America with brands unknown here. In addition, a financial service provider is part of the corporate structure.

In the first nine months of 2023, Traton generated 34 billion euros in sales, which is 20% more than in the previous year. The increase in sales was possible because demand for commercial vehicles is still high. Since January 2023, the sales of trucks and buses have increased by 15%. Prices have been increased, so that additional costs for energy and raw materials can be passed on to customers.

A potential challenge in the near future, however, could be the looming recession. If less is consumed, logisticians have less to do and therefore order no new transport vehicles. In addition, after the end of the Corona pandemic, the figures in the e-commerce business will decrease. In particular, less is ordered online in Europe, so that fewer goods have to be delivered.

However, out of concern for supply bottlenecks, more commercial vehicles were ordered than were actually needed. That is why the 26% drop in orders on a 9-month basis should be seen rather as normalization.

A look at the valuation makes the share definitely interesting for bargain hunters among investors. With a market value of 9.5 billion euros, the paper is only valued at four times the expected profit. That sounds like a real bargain, but car makers are usually valued lower because the industry is facing a major transformation.

This also applies to the commercial vehicle sector. There are still very few battery-powered vehicles here, but in the long run an alternative to the combustion engine is needed. The high debt of Traton also weighs negatively. At the end of 2022, this was more than 3 billion euros.

For risk-loving investors, however, a look may be worthwhile, as the entry level is currently quite attractive. Decide for yourself whether the shares would be something for your portfolio.