Renault (RNO) AI Stock Analysis

• Market Cap: €9.83B
• Dividend Yield: 6.52%
• Average Volume (3M): 1.52M
• Price to Earnings (P/E): 12.3
• Beta (1Y): 1.14
• Revenue Growth: 7.36%
• EPS Growth: -64.31%
• Country: FR
• Employees: 98,636
• Sector: Industrials
• Sector Strength: 94
• Industry: Auto - Manufacturers
• EPS (TTM): -2.00
• Shares Outstanding: 295,722,260
• 10 Day Avg. Volume: 2,058,622
• 30 Day Avg. Volume: 1,517,234
• PEG Ratio: -0.26
• Price to Book (P/B): 0.30
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 2.38
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €49.00
• Price Target Upside: 45.19% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 70 Neutral
• Price Target: €37.00 ▲(9.63%Upside)

Renault's overall stock score is driven by solid financial performance, particularly in cash flow generation and revenue growth. While valuation is fair, technical analysis suggests mixed signals with bearish trends observed. Key areas for improvement include enhancing profitability metrics to boost shareholder returns.

Positive Factors

Financial Position

Renault’s €7.1bn net auto net financial position positively surprised, and now equals approximately 50% of its current market capitalization.

Partnerships

Cooperation with Geely continues to take shape, creating opportunities for growth and synergies.

Product Development

The upcoming Twingo BEV boasts a development time of less than two years and will have a price tag below €20k, making it a truly affordable BEV.

Negative Factors

Earnings Expectations

Renault's 2024 results and 2025 outlook are both towards the low end of market expectations, leaving no room for upgrades.

Profit Margins

CO2 compliance was a bigger than feared overhang, impacting margins due to Renault's 18% EU share in light commercial vehicles.

Stock Downgrade

The analyst downgrades the stock to Hold due to reduced earnings and lower net liquidity.

Renault Business Overview & Revenue Model

Company Description

Renault SA designs, manufactures, sells, and distributes vehicles in France and internationally. The company operates through Automotive, AVTOVAZ, Sales Financing, and Mobility Services segments. It offers passenger and light commercial, and electric vehicles primarily under the Renault, Dacia, Renault Samsung Motors, Alpine, LADA, Jinbei & Huaasong, and Eveasy, as well as under the Nissan, Datsun, and Infiniti brands. The company also sells powertrains and used vehicles, and spare parts; and provides various services, including vehicle sales financing, rental, maintenance, and service contracts. In addition, it offers finance for the purchase on inventories of new and used vehicles, and replacement parts; designs, produces, and sells converted vehicles; Renault EASY CONNECT for Fleet, a connected service for business users; and produces driving aids, such as steering-wheel mounted accelerators and brakes, multifunction remote control units to operate indicators, lights and horns, pedal transfers, etc.; and manual or electric swivel seats. Renault SA was founded in 1898 and is based in Boulogne-Billancourt, France.

How the Company Makes Money

Renault makes money primarily through the design, manufacture, and sale of vehicles. Its revenue streams are diversified across several segments, including passenger cars, commercial vehicles, and electric vehicles. A significant part of Renault's income comes from its global sales network, which includes dealerships, service centers, and online platforms. Additionally, Renault benefits from its strategic alliances, particularly the Renault-Nissan-Mitsubishi Alliance, which enables cost-sharing in research and development, production, and marketing. The company also generates revenue through aftersales services, financial services, and leasing agreements. Key factors contributing to Renault's earnings include its strong presence in Europe, growth in emerging markets, and investments in innovative technologies such as electric mobility and connected cars.

Renault Financial Statement Overview

Summary

Renault exhibits solid revenue growth and robust cash flow management, as evidenced by a 7.37% increase in revenue and a 194.11% growth in free cash flow. However, the net profit margin of 1.34% and ROE of 2.48% indicate moderate profitability and efficiency challenges, suggesting the need for improvement in generating shareholder value.

Income Statement

Renault's income statement reflects a positive trajectory in revenue growth, with a 7.37% increase from 2023 to 2024. The gross profit margin is healthy at 20.78%, although the net profit margin is relatively low at 1.34%, indicating moderate profitability challenges. The EBIT margin of 4.58% and EBITDA margin of 10.54% suggest adequate operational efficiency, though improvements could enhance overall profitability.

Balance Sheet

The balance sheet shows a solid equity base with an equity ratio of 23.43%. The debt-to-equity ratio is 0.32, indicating reasonable leverage. However, the return on equity (ROE) is low at 2.48%, highlighting challenges in generating returns for shareholders. The company's financial stability is supported by a substantial cash balance.

Cash Flow

Renault demonstrates robust cash flow management, with a significant free cash flow growth rate of 194.11% from 2023 to 2024. The operating cash flow to net income ratio is strong at 9.52, indicating efficient cash generation relative to net income. Free cash flow to net income ratio is notably high at 5.47, reflecting excellent free cash flow conversion.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	56.23B	52.38B	46.39B	41.66B	43.47B
Gross Profit	11.69B	10.90B	8.27B	6.87B	6.01B
EBITDA	5.93B	6.39B	7.59B	4.80B	3.65B
Net Income	752.00M	2.20B	-338.00M	888.00M	-8.01B
Balance Sheet
Total Assets	129.37B	121.91B	118.32B	113.74B	115.74B
Cash, Cash Equivalents and Short-Term Investments	23.07B	20.20B	22.36B	22.82B	22.12B
Total Debt	9.57B	65.08B	64.34B	61.96B	64.89B
Total Liabilities	98.26B	91.28B	88.78B	85.85B	90.40B
Stockholders Equity	30.31B	29.75B	28.80B	27.32B	24.77B
Cash Flow
Free Cash Flow	4.11B	1.40B	929.00M	-277.00M	1.54B
Operating Cash Flow	7.16B	4.46B	3.61B	2.41B	5.75B
Investing Cash Flow	-2.04B	-2.23B	-3.24B	-1.62B	-4.23B
Financing Cash Flow	-3.23B	-3.08B	-532.00M	-629.00M	5.59B

Renault Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 33.75
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FR:RNO, the sentiment is Negative. The current price of 33.75 is below the 20-day moving average (MA) of 38.47, below the 50-day MA of 41.82, and below the 200-day MA of 43.09, indicating a bearish trend. The MACD of -2.17 indicates Positive momentum. The RSI at 29.65 is Positive, neither overbought nor oversold. The STOCH value of 6.52 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FR:RNO.

Renault Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RNO	70 Neutral	€9.83B	12.30	2.50%	6.52%	7.36%	-64.31%
Sector *	65 Neutral	$11.06B	15.73	5.16%	1.93%	3.12%	-25.59%
0MGR	―	€1.98B	10.39	-4.21%	4.96%	―	―
0HV8	―	€1.97B	13.38	2.80%	―	―	―
0RH5	―	€2.52B	15.54	4.44%	4.05%	―	―
MGDDF	―	$27.04B	13.56	10.41%	0.11%	―	―
MLHK	55 Neutral	€3.12B	103.18		0.07%	15.42%	160.67%