Shares of the DAX-40-listed German car maker Volkswagen AG (DE:VOW3) were hit hard today after the company cut down its margin outlook for the full year 2023. The downgrade was mainly due to “negative effects from raw materials hedges,” which led to a decline in the operating return on sales guidance to the range of 7%-7.3%, compared to the earlier forecast of 7.5%-8.5%.
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The company maintained its forecast for its deliveries and sales numbers. Analysts expect the lower margin forecast to reduce the consensus estimate by “low single digits.” Nonetheless, the stable delivery numbers indicate robust demand for the company’s products.
The stock has been trading down by 2.03% today at the time of writing. In the last six months, the company’s shares have lost around 20% of their value, mainly driven by its disappointing numbers in Q2 and a decline in the full-year sales forecast.
Volkswagen (VW) is a renowned premium car manufacturing company that owns prestigious brands such as Volkswagen, Skoda, Audi, Bentley, Ducati, Lamborghini, and many more.
Preliminary Numbers Q3 2023
On October 20, the company published its preliminary numbers for its third quarter ahead of its Q3 earnings report on October 26.
The revenue for the group grew by 12% to €78.8 billion in the third quarter. The highlight of the quarter was the company’s sale of all-electric vehicles, which reached 209,900 units, marking a 40.5% year-over-year increase. BEVs (battery-electric vehicles) now account for 9% of the company’s total volume, up from 6.8% last year.
Volkswagen expects to deliver between 9 and 9.5 million vehicles to customers in Fiscal 2023. The company anticipates revenue growth in the range of 10% to 15%. Also, the company anticipates a loss of €2.5 billion related to raw material hedging transactions to impact its full-year operating results. Consequently, it expects operating results to remain similar to the previous year’s level of €22.5 billion.
Is Volkswagen Shares a Good Buy?
According to TipRanks’ consensus, VOW stock has received a Moderate Buy rating based on recommendations from nine analysts. This includes five Buys, three Holds, and one Sell rating. The Volkswagen share price forecast is €136.67, which is 21% higher than the current price level.
