Porsche AG (DE:PAH3) is enduring a historic slump as its stock heads toward its most difficult week since its 2022 market debut. On Friday, shares of the iconic 911 manufacturer are on track for a 10% weekly decline, a drop that highlights the deepening crisis within the European automotive sector. This downturn is part of a multi-year slide that has seen Porsche’s valuation nearly cut in half since its initial public offering.
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Porsche Is in the Middle of a Major Restructuring
During a recent investment seminar in New York, Porsche’s Chief Financial Officer, Jochen Breckner, reportedly offered an even “more conservative” outlook for the coming months than previously shared. Analysts from Oddo BHF noted that the company is currently in the middle of a “major restructuring” that has heavily impacted its bottom line. The consensus among financial experts is that 2026 will serve as a “transition year,” though many are skeptical about how quickly profitability can return to the high levels seen pre-IPO.
Porsche Faces Headwinds from China
The most significant headwind for Porsche remains the collapse of the luxury market in China. Former CEO Oliver Blume recently admitted that the brand “got it wrong” regarding the pace of EV adoption in that region. By moving the best-selling Macan to an all-electric platform and removing combustion-engine options, Porsche inadvertently ceded market share to competitors who offer more flexible powertrain choices.
| Key Challenge | Impact on Business | Status in 2026 |
| China Sales | 20% decline in luxury segment | Continuing weakness |
| Model Gaps | Discontinuation of ICE Macan/718 | Supply shortages |
| Board Shakeup | Departure of key CFO/Sales leaders | New management seated |
| EV Margins | Lower profitability than petrol cars | Under pressure |
Investors Hold Out Hope for Porsche’s New CEO
Despite the grim stock performance, some investors are holding out hope for Michael Leiters, who officially took over as CEO this month. Leiters, a veteran of Ferrari (RACE) and McLaren, is tasked with restoring Porsche’s emotional pull while navigating a more cautious path toward electrification. His arrival ends the controversial period during which Oliver Blume served as the dual CEO of both Porsche and its parent company, Volkswagen (VWAGY).
However, the road ahead is steep. As Moritz Kronenberger of Union Investment pointed out, the company needs to show a significant jump in free cash flow soon, or the market will begin to question its long-term valuation entirely.
Is Porsche Stock a Good Buy Right Now?
Turning to TipRanks, Porsche’s stock (PAH3) has a Hold consensus rating based on 12 Buys, 11 Holds, and eight Sells assigned in the last three months. The average 12-month Porsche price target sits at €43.92, implying an upside potential of 17%.
