Faurecia: stock bounces back after falling for 3 months
(CercleFinance.com) - The share of the automotive component supplier Faurecia finished up over 4% in Paris on Tuesday, approaching 55 euros again.
Indeed, broker Kepler Cheuvreux now recommends investors buy the share, upgrading it from hold, even though they have cut their target price by just over 7% to 65 euros.
This is an interesting change, in that Faurecia was, just three months ago, best placed amongst the major French auto equipment manufacturers and at the end of May, the share was not far off the threshold of 77 euros. However, it should be said that its organic growth (8.5% over H1) is significantly stronger than those of its peers Valeo, and Plastic Omnium.
That being so, the share has, like the entire automotive sector, suffered from an increasingly cloudy sky. Of course, the transition towards the electrification of cars, and eventually their automation, raises serious doubts about capital allocation in the sector. Even so, this is more an issue for car makers themselves, which have a large presence in Europe in thermal engines, rather than OEMs. Ditto
for the new certification system (the famous emission tests) WLTP, after the "Dieselgate" scandal. However, both groups are exposed to the risk of a trade war from the US, where French OEMs have a greater presence than car makers such as Peugeot and Renault.
Copyright (c) 2018 CercleFinance.com. All rights reserved.
Indeed, broker Kepler Cheuvreux now recommends investors buy the share, upgrading it from hold, even though they have cut their target price by just over 7% to 65 euros.
This is an interesting change, in that Faurecia was, just three months ago, best placed amongst the major French auto equipment manufacturers and at the end of May, the share was not far off the threshold of 77 euros. However, it should be said that its organic growth (8.5% over H1) is significantly stronger than those of its peers Valeo, and Plastic Omnium.
That being so, the share has, like the entire automotive sector, suffered from an increasingly cloudy sky. Of course, the transition towards the electrification of cars, and eventually their automation, raises serious doubts about capital allocation in the sector. Even so, this is more an issue for car makers themselves, which have a large presence in Europe in thermal engines, rather than OEMs. Ditto
for the new certification system (the famous emission tests) WLTP, after the "Dieselgate" scandal. However, both groups are exposed to the risk of a trade war from the US, where French OEMs have a greater presence than car makers such as Peugeot and Renault.
Copyright (c) 2018 CercleFinance.com. All rights reserved.