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Mercedes-Benz Group AG MBGAF

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Company Report

Mercedes-Benz Earnings: Mixed Results in a Tough Environment, but Stock Remains Undervalued

Narrow-moat-rated Mercedes-Benz reported fourth-quarter earnings per share of EUR 2.99, EUR 0.34 better than the EUR 2.65 FactSet consensus but down EUR 0.73 from EUR 3.66 last year. Supply chain disruption (chips, logistics) kept consolidated volume relatively flat, down only 0.9% to 511,000 units from 515,000. Group revenue slipped 2% to EUR 40.3 billion from EUR 41.0 billion a year ago but beat consensus by 3%. Generally, pricing was favorable except for battery electric vehicle where competition has intensified. Mix was slightly unfavorable as entry product volume increased while top-end was flat and core declined slightly.

Price vs Fair Value

MBGAF is trading at a 37% discount.
Price
$79.88
Fair Value
$389.00
Uncertainty
High
1-Star Price
$252.82
5-Star Price
$45.90
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Mercedes-Benz is a highly recognizable, well-respected global premium and luxury brand, which gives the company a modest buffer against the cyclical downturns of auto sales.

Bears

The global premium car market is highly competitive, and consumers can easily switch among brands.

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News

Trading Information

Previous Close Price
Day Range
52-Week Range
Bid/Ask
/
Market Cap
Volume/Avg
/

Key Statistics

Price/Earnings (Normalized)
5.37
Price/Sales
0.52
Dividend Yield (Trailing)
7.17%
Dividend Yield (Forward)
7.15%
Total Yield
7.17%

Company Profile

Based in Stuttgart, Germany, Mercedes-Benz Group makes premium and luxury passenger vehicles and commercial vans. Brands include Mercedes-Benz, AMG, and Maybach. Mercedes-Benz Mobility provides the company's dealers and its customers with vehicle financing as well as mobility services in ride hailing, car sharing, and charging. Mercedes owns 9.74% of Aston Martin and 9.55% of Beijing Automotive Group. Through Tenaciou3 Prospect Investment, Li Shufu, chair of Chinese automaker Geely, owns 9.69% of Mercedes-Benz. Other major shareholders include Beijing Automotive Group at 9.98% and Kuwait Investment Authority at 4.9% (6.8% before the sale of a 1.9% stake in March 2023).
Sector
Consumer Cyclical
Industry
Auto Manufacturers
Stock Style Box
Large Value
Total Number of Employees
167,397

Competitors

Valuation

Metric
MBGAF
F
NSANY
Price/Earnings (Normalized)
5.376.274.12
Price/Book Value
0.891.190.39
Price/Sales
0.520.290.17
Price/Cash Flow
3.743.742.07
Price/Earnings
MBGAF
F
NSANY

Financial Strength

Metric
MBGAF
F
NSANY
Quick Ratio
0.831.011.36
Current Ratio
1.241.201.75
Interest Coverage
62.152.827.91
Quick Ratio
MBGAF
F
NSANY

Profitability

Metric
MBGAF
F
NSANY
Return on Assets (Normalized)
5.98%3.08%2.64%
Return on Equity (Normalized)
17.96%18.80%8.81%
Return on Invested Capital (Normalized)
8.72%4.23%3.75%
Return on Assets
MBGAF
F
NSANY
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