BMW car at the IAA
The car manufacturer was one of the winners on the stock market in the first half of the year. The mood has now changed.
(Photo: dpa)
BMW shares came under pressure on Thursday due to an analyst comment. Henning Cosman from the British bank Barclays downgraded the stock from “equal weight” to “underweight”, which is equivalent to a sell recommendation. He also lowered his price target from 107.50 to 92.50 euros.
The share then fell by up to 2.3 percent to 95.06 euros. This means that it at least stayed above the recent interim low of 93.78 euros.
In his study presented on Thursday, Cosman wrote of the “fear of price normalization”. The signals for the operating profit margin in the second half of the year indicated that the margin was below that of the first half of the year. This supports the thesis of a peak in prices and profitability. Contrary to the market consensus, Cosman does not expect margins to increase in 2024 and 2025 either.
According to the financial service Refinitiv, only seven of 26 analysts currently recommend buying the stock. 14 recommend holding and four recommend selling.
In mid-July, the hedge fund Viking Global Investors also published a short position on the stock, which increases in value when prices fall. It was the first short bet at BMW in four years.
Surprising development
The development may come as a surprise. After all, BMW shares were one of the biggest winners on the German market in the first half of the year. The stock is currently up more than 20 percent since the beginning of the year – significantly more than the German leading index Dax.
Viking has now reduced the position below the reportable threshold of 0.5 percent of freely tradable shares. It is therefore not known whether the hedge fund is still betting against BMW. It would have been worth it: the share price has fallen by around ten percent since mid-July.
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