Morgan Stanley reiterated an Equal-Weight rating on Volkswagen (ETR:VOWG_p) and maintained their 12-month price target of €130.00 on the stock following the automaker’s 3Q earnings release.
Analysts at Morgan Stanley expect VW to see a “neutral market reaction” after shares dipped following a pre-release of the results last week.
Volkswagen recorded total revenues of €78.8 billion in the 3Q, a 1% increase compared to the market's estimated values and a 4% increase compared to the company's internal projections. This revenue growth represents a 12% year-on-year expansion, primarily attributed to the delivery of 2.3 million units, marking a notable 7% increase from the previous year.
Volkswagen reported an operating income of approximately €4.B, reflecting a margin of 6.2%, marking a positive shift of around 15% from the 3Q of 2022. However, it fell short of the consensus estimates by approximately 14%, which had projected earnings of €5.7B.
Year to date, VW has secured a BEV share of 7.9%, indicating steady progress towards meeting the recently revised guidance of 8-10% for the full fiscal year 2023. The order bank stands at 1.4m units in Western Europe, with 150,000 of these units consisting of BEVs.
At the close of the third quarter of 2023, the investment ratio stood at 12.5%. This suggests a probable uptick in expenditure during the fourth quarter, aiming to achieve the targeted ratio of approximately 14.5% for the entire fiscal year of 2023.