FRANKFURT (dpa-AFX Broker) - Investment bank Stifel made a drastic cut in its valuation of Volkswagen (VW) shares on Friday. Following a change in the valuation process, the price target was almost halved from 295 to 149 (current price 116.60) euros. In the course of this, the previous buy recommendation was also removed, the new vote is "Hold".

Analyst Daniel Schwarz emphasized in his study that the drastic cut was to a lesser extent due to the special dividend of 19 euros per share paid by VW. However, after the IPO of VW's sports car subsidiary Porsche AG was completed, it was also a new realization that the VW Group was not profiting adequately from such valuable investments, he said.

In addition to Porsche AG, he also mentioned the Lamborghini and Bentley brands belonging to VW. A chance for a new and higher valuation of VW shares could indeed involve further sales of Porsche AG shares - but that would have been ruled out by the Wolfsburg-based company.

Against this background, he no longer considers the previous valuation approach based on the sum of the Group's parts to be appropriate. He now bases the value potential of the share on the price/earnings ratio.

Schwarz generally considers European automakers to be attractive. In the German sector environment, however, he advises investors to focus on manufacturers with a clear positioning in the premium segment. His only buy recommendation among German automakers is now Mercedes-Benz. The expert also only rates premium competitors BMW and Porsche AG as "hold".

The expert's views also affect the shares of VW's parent company Porsche SE. For these, Schwarz also significantly reduced his price target from 132 to 78 euros. However, he maintained his previous buy recommendation for Porsche SE, as the shares offered a better ratio of opportunities and risks in a VW comparison.

According to the "Hold" rating, the analysts at Stifel believe that the share will have a total return (share price development + dividend yield) of between -5 percent and +10 percent over a twelve-month period. With a "Buy" rating, Stifel's analysts expect the stock to post an absolute price gain of more than 10 percent on a twelve-month horizon./tih/ag/mis

Analyzing institute Stifel.

Publication of the original study: 24.03.2023 / 02:00 / EDT

First disclosure of the original study: 24.03.2023 / 02:00 / EDT