Renault (RNO) AI Stock Analysis

• Market Cap: €9.96B
• Dividend Yield: 6.4%
• Average Volume (3M): 1.05M
• Price to Earnings (P/E): 12.4
• Beta (1Y): 1.10
• Revenue Growth: 8.44%
• EPS Growth: -937.75%
• Country: FR
• Employees: 98,636
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Manufacturers
• EPS (TTM): -40.90
• Shares Outstanding: 295,722,260
• 10 Day Avg. Volume: 1,001,853
• 30 Day Avg. Volume: 1,051,508
• PEG Ratio: -0.26
• Price to Book (P/B): 0.43
• Price to Sales (P/S): 0.23
• P/FCF Ratio: 3.16
• 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: €42.00
• Price Target Upside: 22.13% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 65 Neutral
• Price Target: €38.00 ▲(10.50% Upside)

Renault's stock score is primarily driven by its solid financial performance, particularly in cash flow management, despite challenges in profitability. Technical analysis indicates short-term strength, though longer-term trends are weaker. Valuation concerns arise from a negative P/E ratio, but a high dividend yield offers some investor appeal.

Positive Factors

Cash Flow Management

Strong cash flow management indicates Renault's ability to generate cash efficiently, supporting operations and strategic investments, enhancing long-term financial stability.

Revenue Growth

Consistent revenue growth showcases Renault's expanding market presence and product demand, contributing to its competitive positioning and long-term business sustainability.

Electric Vehicle Focus

By focusing on electric vehicles, Renault aligns with industry trends towards sustainability, potentially capturing market share and benefiting from regulatory incentives.

Negative Factors

Job Cuts Consideration

Potential job cuts indicate cost-cutting measures due to market uncertainties, which could impact employee morale and operational efficiency in the long term.

Low Return on Equity

Low ROE suggests inefficiencies in utilizing equity to generate profits, potentially affecting investor confidence and long-term shareholder value.

Profitability Challenges

Low profitability margins highlight challenges in cost management and pricing power, which could hinder Renault's ability to reinvest in growth and innovation.

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 generates revenue primarily through the sale of vehicles, which includes both passenger cars and commercial vehicles. Key revenue streams include sales of new vehicles, financing services, and after-sales services such as maintenance and spare parts. The company also benefits from strategic partnerships within the Renault-Nissan-Mitsubishi Alliance, which allows for shared technology development and cost reduction through economies of scale. Additionally, Renault has been increasing its focus on electric vehicles, leveraging government incentives and growing consumer demand for sustainable transportation solutions, which contributes positively to its earnings.

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	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	56.91B	56.23B	52.38B	46.39B	41.66B	43.47B
Gross Profit	11.09B	11.69B	10.90B	8.27B	6.87B	6.01B
EBITDA	5.67B	5.93B	6.39B	7.59B	4.80B	3.65B
Net Income	-11.73B	752.00M	2.20B	-338.00M	888.00M	-8.01B
Balance Sheet
Total Assets	116.94B	129.37B	121.91B	118.32B	113.74B	115.74B
Cash, Cash Equivalents and Short-Term Investments	19.68B	23.07B	20.20B	22.36B	22.82B	22.12B
Total Debt	8.18B	9.57B	65.08B	64.34B	61.96B	64.89B
Total Liabilities	96.29B	98.26B	91.28B	88.78B	85.85B	90.40B
Stockholders Equity	19.88B	30.31B	29.75B	28.80B	27.32B	24.77B
Cash Flow
Free Cash Flow	1.12B	4.11B	1.40B	929.00M	-277.00M	1.54B
Operating Cash Flow	3.99B	7.16B	4.46B	3.61B	2.41B	5.75B
Investing Cash Flow	-1.82B	-2.04B	-2.23B	-3.24B	-1.62B	-4.23B
Financing Cash Flow	-4.36B	-3.23B	-3.08B	-532.00M	-629.00M	5.59B

Renault Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 34.39
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 34.39 is below the 20-day moving average (MA) of 34.80, above the 50-day MA of 34.08, and below the 200-day MA of 41.05, indicating a neutral trend. The MACD of -0.08 indicates Positive momentum. The RSI at 48.50 is Neutral, neither overbought nor oversold. The STOCH value of 21.82 is Neutral, 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
PEUG	75 Outperform	€1.82B	45.73	0.83%	4.43%	-48.21%	-64.53%
RNO	65 Neutral	€9.96B	12.39	-46.54%	6.40%	8.44%	-937.75%
FR	63 Neutral	€2.43B	19.51	3.67%	4.19%	-4.16%	-48.55%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
ML	61 Neutral	$19.11B	12.27	8.49%	5.10%	-3.62%	-17.91%
FRVIA	60 Neutral	€2.10B	10.39	-11.30%	4.69%	-0.90%	-324.34%
MLHK	54 Neutral	€1.63B	63.10	―	0.13%	8.84%	78.33%