(CercleFinance.com) – AlphaValue announced on Monday that it has raised its price target on BMW from 87.6 to 97.3 euros, in order to take into account the consolidation of its joint venture in China and its strong first quarter results.
In a research note, the independent research office – which maintains its recommendation to ‘accumulate’ on the title – justifies its increase by the increase from 50% to 75% of the group’s stake in the Chinese joint venture BMW Brilliance and by the prospect of a better than expected operating margin after the good performance recorded in the first quarter.
The research firm warns, however, that investors will have to closely monitor the evolution of the Covid-19 epidemic in China, where the automaker has established a sizeable industrial presence.
“This situation constitutes the first risk factor concerning the results of the second quarter, even if a possible underperformance could be offset by the second half, once the health restrictions are lifted”, he concludes.
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