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Aston Martin joins the ranks of publicly traded automakers with an IPO that values the UK business at over $ 5 billion. But his first day of trading in London had a difficult start.
The preferred automaker of James Bond, a fictional British secret service agent, valued his shares at £ 19.00 ($ 24.70), a valuation of £ 4.3 billion ($ 5.6 billion) .
The final selling price is 16% lower than the top of the Aston Martin target range, reflecting investors' doubts whether the automaker should be rated in the same category as its Italian rival Ferrari.
Shares plunged 6.6% at the start of the London session on Wednesday.
At its IPO, the UK company asks investors to overcome their fears over US threats to tax foreign automobiles and the UK's exit potential from the European Union to disrupt supply chains and markets. markets.
Aston Martin, which has a history of bankruptcy, is now making substantial profits.
He sold more than 5,000 cars in 2017, his best performance in nine years. This generated record earnings of £ 876 million ($ 1.1 billion), an increase of almost 50% over the previous year.
The results of the first half of this year show that momentum has continued. Revenues rose 8% over the same period a year earlier, while profits rose 14%, according to figures released last month.
Aston Martin has sought in recent years to capitalize on its high-end brand. But Bernstein's analysts see several potential problems.
They argue that the Aston Martin brand is not as strong as that of Ferrari (RACE)The British automaker also has much smaller margins than its Italian rival and a disturbing history of uneven sales, reinforced by decades of racing history and a host of Formula One championships.
With the funds raised during the IPO for existing shareholders rather than investing in the company, Aston Martin's executives were likely to give too much hope to the success of an anticipated SUV.
"Given the current financial situation and seemingly less robust demand, it is difficult for us to see how this could match the profitability of Ferrari," Bernstein analysts recently wrote. "We can not see him getting close."
Among the owners of Aston Martin, the parent company of Mercedes-Benz Daimler (DDAIF), an Investindustrial private equity firm and investors based in Kuwait.
CNNMoney (London) First published on October 3, 2018 at 4:38 am ET
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