As previously reported, Wolfe Research downgraded Stellantis (STLA) to Underperform from Peer Perform with a EUR 6 price target The firm says its earnings estimates are about 40% below consensus in 2025 and 45% below in 2026, driven primarily by North America. In NA this year, the firm models a EUR 1B loss vs. consensus of EUR 1.6B profit. Even this may be optimistic, Wolfe says, as it is assuming 2.5% year-over-year pricing gains in the second half of 2025 despite overall market share remaining at all-time lows. The bigger issue is likely free cash flow. After burning EUR 6B last year, the firm expects another EUR 3B-plus negative in 2025 and 2026. Further, Wolfe believes valuation does not suggest the market is fully pricing in these risks.
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