Volkswagen: RBC lowers target price

(CercleFinance.com) - On Monday, RBC renewed its 'outperform' rating on Volkswagen, while lowering its target price for the stock from E137 to E131.


The Canadian broker says that, on announcing its Q2 results, the German automotive group stated that it expects its annual EBIT growth to be at the lower end of its target range of 6.5% to 7% (excluding exceptional items) for the current financial year as a whole.

The broker believes that the forecast of organic growth that is likely to reach 5% in 2024 is also over-ambitious, itself expecting around breakeven this year.

RBC points out, however, that the automaker's difficulties are essentially due to the steel supply problems encountered by its Porsche luxury car subsidiary.

Excluding the latter, the VW Group's H2 performance nevertheless looks 'solid', it notes.

Once the company has managed to resolve its supply difficulties, the future could look bright, RBC concludes.


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