Daimler: 'The Worst' is over, Oddo Bhf maintains buy rating

(CercleFinance.com) - An analyst at Oddo BHF this morning announces that he is maintaining his "buy" rating on the Daimler stock, deeming that, after last week's profit warning, the worst is now behind us.


Indeed on Friday Daimler announced another new reduction in its 2018 targets, due to the settlement of two ongoing legal disputes (one concerning diesel engines, the other concerning the coolant gas used by Daimler on certain air conditioning units until 2013). This settlement has led Daimler to book two provisions in its Q3 accounts, which Oddo BHF estimates at 300/350 million euros.

"After a nightmarish 2018 (fire of a supplier in US, WLTP, recall/Cars and Vans, inability to satisfy the sharp rise in orders/US Truck due to a shortage of components, renewal of the Sprinter), EBIT is expected to improve mechanically from Q4 (sales rebound/Auto, increase in US/Truck production, Sprinter gathering pace). Meanwhile, the number of 'pending legal issues' is falling. As a result, the stock valuation has become particularly attractive," Oddo BHF says, which sees "a mechanical improvement from Q4" taking shape.

The broker thus confirms its target price of 80 euros.




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