FRANKFURT (dpa-AFX) – Car stocks were among the most sought-after stocks on the German and European stock markets on Friday. The focus was on the annual outlook of major banks for the industry. Investors tended to follow the optimistic arguments of the analysis house Jefferies, while more critical tones from the British investment bank Barclays were less well received before the weekend.
Thanks to the optimism expressed by both analysis houses, Volkswagen (Volkswagen (VW) vz) was one of the biggest winners in the DAX with a share price increase of 2.1 percent. BMW shares (BMW) rose by 0.8 percent, while Mercedes-Benz (Mercedes-Benz Group (ex Daimler)) rose by 1.5 percent. In the MDAX, Porsche AG (Porsche vz) also rose by 1.9 percent.
Internationally, Stellantis shares rose by 2.3 percent, while Renault was up 0.7 percent. The European auto sector was among the strongest sectors on Friday Eurozone and recently performed even better than the EuroStoxx 50.
Jefferies analyst Philippe Houchois expects optimistic forecasts for 2026 from Volkswagen and Stellantis, for which he also maintained his buy rating and noticeably increased the price targets. The two car companies are likely to predict improvements in operational business and could surprise with strategic decisions. VW will probably continue to focus on cost control and software cooperation with Tesla rival Rivian (Rivian Automotive).
BMW and Mercedes-Benz, on the other hand, are facing a year of transition with tariff burdens in the first quarter, while the model cycle should help in the second half of the year and market shares in China could have bottomed out. Overall, Houchois expects BMW to be somewhat more optimistic in the new year than Mercedes. Renault and Porsche are likely to expect slightly weaker margins with a view to 2026. He left both of them on hold, as did BMW and Mercedes, but increased his price targets throughout.
From the perspective of Barclays expert Henning Cosman, tariffs, emissions regulations, EU regulations and the Chinese market will continue to be the focus of the debate in the new year. He remains generally negative for the sector as there is no lack of structural headwinds. He downgraded BMW and Porsche AG to “Underweight” – largely due to high valuations and his expectations, which were below consensus.
Mercedes prefers Cosman over BMW because of its better cash inflow and potential for self-optimization. For the Stuttgart company, he stuck to his “equal weight” vote and increased the price target. One of his industry favorites is VW, which continues to be rated “Overweight”. The analyst also remains positive about Renault due, among other things, to the strong free cash inflow./niw/tih/mis
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