(Boursier.com) — Renault is trying to resist the sharp decline in the market in the aftermath of its violent fall: the manufacturer’s stock nibbles 0.5% to 33.6 euros at midday. The group revealed quarterly revenues of €10.5 billion, up 8% as reported (+14% excluding currency effects) and in line with consensus expectations (E10.5 billion). Oddo BHF explains that the more negative volume effect than expected at -1.6% (registrations up 6%) due to greater than expected distributor destocking was disappointing but was able to be offset, in particular by a stronger price effect at +7.5%, confirming the benefits of the manufacturer’s commercial policy. Finally, the annual objectives were obviously confirmed, as expected.
Despite the share’s decline yesterday, the publication and management’s comments reinforce the analyst’s idea that the manufacturer is still ahead of its objectives, especially since the best is yet to come even though the product offensive is only just beginning, the fruits of the important work on costs are not yet all visible and the other catalysts remain numerous (finalization of Aramco’s entry into Horse, CMD Ampère on 11/15 , finalization of the new Alliance agreement and then possibility of transfers of Nissan shares in particular). The broker thus maintains its positive opinion on the stock which remains among its favorite stocks this year. It nevertheless revises its objective from 60 to 55 euros following the recent sector derating (more conservative multiples, unchanged estimates) but this still suggests significant potential given current valuation levels (PE 24 less than 2.5x).
SocGen has, moreover, adjusted the slider from 49 to 48 euros while remaining at ‘purchase’, while HSBC (‘purchase’) reduced the target from 50 to 47 euros.
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