|Bid||0.00 x 0|
|Ask||0.00 x 0|
|Day's range||21.74 - 22.29|
|52-week range||17.85 - 27.06|
|Beta (5Y Monthly)||N/A|
|PE ratio (TTM)||6.48|
|Earnings date||26 Feb 2020|
|Forward dividend & yield||N/A (N/A)|
|1y target est||24.75|
Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Julien Ponthus. European stock markets are expected to open just slightly in positive territory as the week’s two main news items, UK election and the Dec.15 tariff deadline enter their end game.
Aston Martin, which was reported this week to be the target of Canadian billionaire Lawrence Stroll, said it was not actively pursuing new investors on Friday as it opened a new factory to build its first sport utility vehicle. As some in the global car industry turn to partnerships, alliances or mergers to handle the challenge of electrification, new technology and tighter margins, Autocar magazine reported on Thursday that Stroll, the owner of Formula One team Racing Point, is preparing to buy a major stake in Aston. The British automaker's new factory in south Wales holds the key to ending a poor performance this year from Aston, whose shares have tumbled 75% this year on weaker-than-expected sales.
British annual car production will drop by a third to 1 million by 2024 if Brexit leads to tariffs with the European Union, a trade body warned on Tuesday, saying output would be lost to other countries. Britons head to the polls in just over two weeks to elect a new government with Prime Minister Boris Johnson promising to pass his Brexit deal as soon as possible, whilst the opposition Labour Party would renegotiate and call a referendum in 2020. The sector, Britain's biggest exporter of goods, warned on Tuesday that World Trade Organisation tariffs on components imported into Britain and exported vehicles would add more than 3.2 billion pounds ($4 billion) a year to manufacturing costs in the worst case scenario.
(Bloomberg Opinion) -- The racketeering lawsuit brought by General Motors Co. against cross-town rival Fiat Chrysler Automobiles NV is a legal bombshell for the U.S. car industry.GM’s broadside lays out in forensic detail how Fiat allegedly conspired over many years to funnel payments to United Auto Workers’ officials, corrupt the collective bargaining process on wages and thus secure a competitive advantage. In essence, it’s trying to rewrite the American auto industry’s past decade of history, which saw both GM and Chrysler bounce back dramatically from Chapter 11 bankruptcy.In GM’s telling, the merger of Italy’s Fiat with Michigan’s Chrysler and their subsequent renaissance under the leadership of Sergio Marchionne was built on corruption. It may have a hard time proving parts of its case, particularly its assertion that the goal of the alleged conspiracy was to weaken GM and force it into a merger with Fiat.The Italian company says the lawsuit is groundless, implying that any bribe-paying would have been a case of a few bad apples. This is an awkward defense, though: Federal prosecutors have accused Fiat managers of trying to keep union officials “fat, dumb and happy” and three of the company’s executives have pleaded guilty to various charges.Regardless of whether GM succeeds in extracting billions of dollars compensation from its rival, the lawsuit seems calculated to punish Fiat and destabilize its recovery. Fiat’s proposed merger with France’s Peugeot SA, a prospective labor deal with the UAW and the reputation of the deceased Marchionne are in the balance. Relations between the two carmakers and with America’s trade unions will never be the same again.GM’s lawsuit contains plenty of salacious claims, but this goes far beyond the accusations of fancy meals, trips and gifts to UAW officials to secure lower and more flexible labor costs. In GM’s allegations, the original sin goes all the way back to 2009 when the Italian company “managed to win the support of the U.S. government in obtaining operational control, for no cash, over an iconic U.S. auto company”.And GM leaves little doubt about where the buck stops for the alleged orgy of trade union bribery that ensued: former Fiat boss Marchionne. This is shocking because for many investors Marchionne was a hero who created huge value. Doubtless this grated with GM, whose own remarkable post-crisis recovery allowed it to fend off Fiat’s merger overtures.There are other things that cast a cloud over the Marchionne era. Last year the U.S. Securities and Exchange Commission found that during his tenure Fiat fraudulently misled investors about how many new vehicles it and its dealers sold each month. Furthermore, the U.S. brought criminal charges against Fiat this year related to alleged diesel emissions cheating between 2011 and 2017. The automaker agreed to pay $800 million in January to settle diesel lawsuits brought by states, car owners and the U.S. Department of Justice, which labelled it a “bad actor.”While Marchionne isn’t alive to defend himself, the mantle of savior of the auto industry has passed to Peugeot’s boss Carlos Tavares. He acquired GM’s Opel/Vauxhall European subsidiary in 2017 and turned it around in record time, an embarrassment for GM which achieved nothing but losses there. The GM lawsuit will be a big test for him, and may encourage him to rethink the terms of the Peugeot-Fiat merger, which clearly favor the Italian side.GM’s move also puts the screws on the UAW to bargain particularly hard with Fiat over a new labor deal. If the union fails to emerge with good terms from those talks, it will look beholden to a carmaker from whom former officials allegedly accepted bribes.These scorched-earth tactics could yet backfire for GM. The technological and regulatory upheaval that’s upended the auto industry probably needs cooperation, not feuds. GM has already secured a new labor deal with the UAW, but re-airing the union’s dirty linen won’t help its own employee relations, which have been scarred by 40 days of strikes this year.GM says the timing is coincidental but nothing about this lawsuit feels haphazard. It’s a precision-guided declaration of corporate war.To contact the author of this story: Chris Bryant at email@example.comTo contact the editor responsible for this story: James Boxell at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Bryant is a Bloomberg Opinion columnist covering industrial companies. He previously worked for the Financial Times.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Julien Ponthus. The Energy sector is also expected to be under pressure with oil prices retreating due to the trade tensions. While we wait to see if there will be any surprise in the list of companies Labour will seek to nationalise should it win the Dec 12 election, Royal Mail and Severn Trent, already targeted, both published trading updates.
European stocks ended flat on Monday as a spurt of defensive buying over uncertainty surrounding U.S.-China trade talks helped temper losses in the auto sector. The pan-European STOXX 600 index finished little changed, after having spent most of the session in negative territory. The European automobiles and parts sector dropped 2.1%, its steepest fall in about four weeks, with Germany's Volkswagen leading declines after it slashed its operating profit and sales growth outlook due to slowdown in the auto sector.
(Bloomberg Opinion) -- If you’ve dropped the kids off at school in London or the New York suburbs recently, the idea that Jaguar Land Rover Automotive Plc is struggling must seem far-fetched. The British carmaker’s Range Rover SUVs have become a common feature of the upper-middle class lifestyle. How else would one get to brunch and the gym?Yet a decade after India’s Tata Group acquired and dramatically reinvigorated these famous old brands, JLR is back on the ropes. The unit lost an eye-peeling 3.3 billion pounds ($4.2 billion) in the fiscal year to March and burned through 1.3 billion pounds of cash. No wonder Tata is casting around for help.JLR’s cost-base has become bloated, its sales in China have collapsed and its big bet on Jaguar saloon (sedan) models has failed to pay off. Selling SUVs to Brits and Americans has prevented its fall from being even more dramatic. However, new gasoline and diesel cars are going to be banned in the U.K. and elsewhere by 2040 and the climate crisis could trigger a backlash against gas-guzzlers well before then. Either way, refashioning the company for a zero-emissions future will be very expensive.Tata insists JLR is not for sale but that doesn’t mean it wants to continue this journey alone. The unit had about 2.2 billion pounds of net debt at the end of September.The Indian parent has approached fellow automakers including China’s Zhejiang Geely Holding Group Co. and Germany’s BMW AG, about forging partnerships to help JLR save money, Bloomberg reported this week. These would supplement existing collaborations with BMW on electric drive systems and with Waymo on autonomous vehicles.This hunt for allies makes sense because JLR’s business model is looking shaky. More than 80% of the vehicles that it sold in Europe last year run on diesel, a technology that’s been undermined by Volkswagen AG’s emissions cheating and the threat of bans in many cities.SUVs make up an even higher percentage of sales. The boom in these vehicles has contributed to a rise in average carbon emissions from carmakers over the past year or two. No wonder they’re in the cross-hairs of climate campaigners. Last month JLR listed “increasing environmental activism” among its biggest challenges.The Extinction Rebellion crowd has a point here. A top-specification Range Rover can weigh more than 5,700 lbs (2,585kg), which is why the company’s vehicles tend to spew out more CO2 than peers.Because it sells less than 300,000 cars annually in Europe, JLR has special dispensation from Brussels to pollute more.(1) However, these lenient fleet emission targets expire in 2028, so the company needs to change its ways sharpish.It says it’s on track to cut emissions by 45% in 2020 compared to 2007 levels, as required by regulators. From next year there will be a hybrid or electric variant of all of its models; and Jaguar’s all-electric I-Pace compact SUV deservedly won car of the year. Creating zero emissions versions of the group’s biggest SUVS will be more difficult, though, because of their hefty weight and poor aerodynamics.Footing the bill will be a stretch too. The company has to manage a 4 billion pound yearly investment budget while selling far fewer cars than its bigger rivals: JLR sold less than 600,000 vehicles last year, about 5% of Volkswagen’s haul. Lackluster sales have left it with unused production capacity.Its attention to detail in manufacturing has also been found wanting. The Jaguar and Land Rover brands came bottom in J.D. Power’s U.S. new vehicle quality rankings, and high warranty costs are an unwelcome feature of its earnings. All of this means JLR’s profit margins are thinner than you might expect given the $210,000 price tag of a high-spec Range Rover.Even as far out as 2023, JLR anticipates an operating return on sales of 6% at most. This is similar to Daimler AG’s 2022 target for Mercedes-Benz, but is way below the margins of French mass-market carmaker Peugeot SA.Thanks to progress on cost-cutting and signs that plunging China sales have bottomed out, investors have become more confident in Tata’s ability to turn JLR around. It returned to profit in the second quarter, prompting a rally in Tata Motors’ shares and JLR’s beaten up bonds. President Donald Trump’s threat of a 25% U.S. tariff on imported vehicles appears to have receded somewhat, as has the likelihood of a no-deal Brexit that would have been ruinous for carmakers.Might this moment of calm tempt a buyer of the company out of the shadows? Tata’s reluctance to sell isn’t the only barrier. Peugeot was rumored to be keen but its chief executive officer Carlos Tavares has found another merger partner in Fiat Chrysler Automobiles NV. Bernstein analyst Max Warburton says BMW would fit but the Bavarians lost a lot of money when they owned Rover in the 1990s.There are also politics to consider. The backlash against SUVs, many built by BMW, is acute in Germany. Doubling down on gas-guzzling urban tractors might harm BMW’s emissions footprint.(2) It might also be viewed poorly by the Berlin government, which boosted electric vehicle subsidies recently.While SUVs can carry lots of baggage, increasingly it’s the wrong kind.(1) JLR's new cars must have average emissions of about 130 g/km of CO2 by 2021, compared to an industry average of 95g.(2) Depending on what happened to JLR's emissions derogationTo contact the author of this story: Chris Bryant at email@example.comTo contact the editor responsible for this story: James Boxell at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Bryant is a Bloomberg Opinion columnist covering industrial companies. He previously worked for the Financial Times.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Optimism over trade talks helped European shares close at their highest level in nearly two years on Monday, while a strong earnings report by Ryanair lifted Irish stocks to a more than one-year high. Siemens Healthineers jumped 9.5% to a record high after it said it expected strong growth to continue next year following a better-than-expected fourth quarter.
(Bloomberg Opinion) -- Peugeot SA’s equity holders might not think much of its takeover of Italy’s Fiat Chrysler Automobiles NV but bondholders appear to love the idea. Fiat’s credit spreads (the extra yield above the benchmark) have tightened by as much as one-third after news of the deal emerged, accompanying a jump in the company’s share price. Peugeot’s shares fell sharply because of concerns about the premium it would have to pay, but the French company’s credit spreads modestly improved. It’s interesting that Peugeot’s shareholders and bondholders took such different views.One reason is that the European Central Bank is restarting its quantitative easing program, meaning there’s a big new buyer in the euro zone for investment grade corporate bonds. If Peugeot-Fiat becomes reality it will have the right hallmarks to attract Christine Lagarde’s Frankfurt institution. While there’s no firm deal yet, the credit rating agency S&P Global Ratings says the creation of the world’s fourth-biggest carmaker would support Fiat’s debt ratings.However, the ECB could be the real driver for shrinking both companies’ credit spreads. The central bank has just restarted its so-called corporate sector purchasing program as part of the 20 billion euro ($22.3 billion) per month QE bond-buying scheme. According to Mahesh Bhimalingam of Bloomberg Intelligence, there could be about 2.5 billion euros per month of corporate debt purchased.Fiat is already rated BBB- by Fitch Ratings, after being upgraded to investment grade from junk last November. This makes it eligible for inclusion onto the ECB’s list of potential purchases. Peugeot was junk-rated too until recently, but is now a stable BBB- across all the major ratings companies. Both companies were too late to feature in the first round of ECB asset-buying, which snapped up 178 billion euros of corporate bonds.The ECB isn’t going to suddenly build huge holdings in Fiat or Peugeot debt, but it’s logical to assume that it will look to add newly eligible industrial names. On average, the central bank owns about 20% of any holding’s total eligible debt. It doesn’t officially buy bonds to make a profit but it’s common sense to prefer an asset that offers some yield when compared to the negative rates of sovereign debt.Furthermore, as the chart above shows, the ECB likes carmakers. It probably owns up to 75 billion euros of debt in the three German autos giants, Volkswagen AG, Daimler AG and BMW AG. It would be strange indeed then if it didn’t acquire a decent chunk of the bonds in one of Europe’s biggest cross-border industrial combinations. That must put a supportive floor under the Fiat and Peugeot credit spreads.To contact the author of this story: Marcus Ashworth at email@example.comTo contact the editor responsible for this story: James Boxell at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Marcus Ashworth is a Bloomberg Opinion columnist covering European markets. He spent three decades in the banking industry, most recently as chief markets strategist at Haitong Securities in London.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
PARIS/MILAN, Oct 31 (Reuters) - European labour unions have called on Peugeot owner PSA and Fiat Chrysler to avoid job cuts and factory closures as the two major carmakers prepare to tie the knot, underscoring worries about the $50 billion deal as the regional economy falters. As PSA and Fiat Chrysler detailed plans on Thursday to create the world's No. 4 automaker, IG Metall, Germany's largest union by members, said it would seek to preserve the autonomy of the French carmaker's German unit Opel. The two groups have said no plants would be closed and an existing arrangement rules out forced layoffs at Opel, bought by PSA two years ago, until mid-2023.
* European stocks end lower after positive open * Reported China doubts about trade deal offset Fed rate cut * Fiat climbs to 1-year high, Peugeot drops after announcing 50-50 merger * Eutelsat falls sharply after weak results * Wall Street falls despite strong Apple, Facebook results Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Julien Ponthus. Reach him on Messenger to share your thoughts on market moves: rm://email@example.com CLOSING SNAPSHOT: PROFIT TAKING, BUT OCTOBER WAS GOOD (1657 GMT) It was a day of profit taking across European stock markets as more brokers advised clients to take a break after the October rally that saw the STOXX 600 recover 6% from the month's lows as investors moved to priced in the good news on Brexit and trade.
World stocks edged to their highest in over 20 months on Thursday after the Federal Reserve cut rates even as it signaled it would hold back from further reductions, sending bond yields and the dollar down. MSCI's world equity index, which tracks shares in 47 countries, rose 0.1% to its highest since early February last year, with many investors remaining expectant of further easing in spite of the Fed's slightly hawkish tone. Asian stocks outside Japan had earlier forged ahead on the cuts, following Wall Street's advance to fresh record highs, climbing 0.3% to touch their highest since Jul. 30.
(Bloomberg Opinion) -- Fiat Chrysler Automobiles NV may have struck too fine a bargain with Peugeot SA. The Italian carmaker has extracted a chunky premium in exchange for agreeing a takeover that’s being dressed up as a merger. At first blush Peugeot’s shareholders aren’t convinced it’s worth it, and it’s not hard to see why they’re skeptical.While there’s no binding deal yet, the terms have been set to ensure Fiat investors take more out of the combination than they put in. The company’s market value was already smaller than Peugeot’s going into the tie-up. Even so, its shareholders — with the billionaire Agnelli family the largest — would withdraw about 5.8 billion euros ($6.5 billion), mainly from a special dividend, before the carmakers come together. That further diminishes Fiat’s financial contribution to the enlarged group.For their part, Peugeot investors will siphon off their company’s stake in car parts-maker Faurecia SE. That’s worth only 2.6 billion euros. Deduct the special dividend and Faurecia from Fiat’s and Peugeot’s respective market values on Tuesday, and the Italian company’s shareholders will contribute about 40% of the combined equity in return for a 50% stake in the new Peugeot-Fiat. Plus they’ll get a half share in the value of any cost savings.True, Fiat was valued closer to Peugeot when judged on average values over the past three months. On that basis, Fiat might deserve some top-up. Still, that alone doesn’t justify the premium.Why is Peugeot being so generous? One reason is that this is really a low-premium takeover by the French company. Peugeot is getting the balance of power in the boardroom, providing the chief executive officer in Carlos Tavares and nominating five out of 10 other roles.The other is that Peugeot’s board thinks it really needs this deal, and is willing to pay for it. Strategically, Fiat brings the U.S. market and the chance to accelerate the development of electric vehicles. Financially, the cost savings are put at 3.7 billion euros yearly. Taxed, capitalized at Fiat’s earnings multiple and adjusted for the more than four years that will be needed to achieve them, these savings could be worth about 6 billion euros even after one-off costs. That’s 3 billion euros to each side.For now the market is taking little on trust. Small wonder. The companies say there will be no plant closures, which puts a lot of pressure on other areas — suppliers in particular — to fund the savings. Peugeot’s and Fiat’s market values have jointly added less than 1 billion euros since talks leaked.Peugeot is presumably counting on the support of its three core investors — the French state, the founding Peugeot family and China’s Dongfeng Motor Group — to get a deal through a shareholder vote if one is finally agreed. But in the market, the jury’s out.To contact the author of this story: Chris Hughes at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Hughes is a Bloomberg Opinion columnist covering deals. He previously worked for Reuters Breakingviews, as well as the Financial Times and the Independent newspaper.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Fiat Chrysler and Peugeot owner PSA have agreed to join forces to create the world's fourth-largest automaker. - Fiat Chrysler Automobiles (FCA) and PSA aim to reach a binding agreement to create a $50 billion (£39 billion) company in the coming weeks. - PSA Chief Executive Carlos Tavares would be the group's CEO.
A daily overview of the top business, market, and economic stories to watch in the UK, Europe, and abroad.
European shares rose on Thursday after the U.S. Federal Reserve cut interest rates, but a slump in auto and energy stocks kept gains in check as investors digested a fresh batch of earnings. The pan-European STOXX 600 index rose 0.3% at 0820GMT led by gains in Milan's FTSE MIB but London's FTSE 100 lagged. The U.S. federal reserve cut interest rates as expected but also signaled there would be no further reductions unless the health of the economy took an unhealthy turn.