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Renault SA (RNLSY)
OTHER OTC:RNLSY
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Renault SA
(OTC:RNLSY)
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Rating:44Neutral
Price Target:
$6.50
▼(-17.51% Downside)
Action:ReiteratedDate:03/01/26
The score is primarily constrained by weak financial performance—2025 profitability deterioration, higher leverage, and negative free cash flow. Technicals also remain soft with the stock below longer-term averages. These are partially offset by supportive income characteristics (high dividend yield) and a relatively positive earnings call with clearer margin/FCF targets, but risks still dominate.
Positive Factors
Sustained revenue growth and midterm guidance
Consistent top-line growth through 2021–2025 and explicit midterm targets for mid-single-digit revenue expansion and 5–7% operating margin provide a durable foundation. If management executes, scale and predictable revenue trends support margin recovery, cash generation and investment priorities over 2–6 months to midterm.
Strong EV and hybrid momentum in Europe
Rapid EV and hybrid adoption (high double-digit growth and rising mix) aligns Renault with long-term electrification trends and regulatory demand. Higher EV penetration and hybrid mix can sustain market share, support future product differentiation and create durability in revenue streams as ICE declines across Europe.
Unit cost reduction and lower CapEx intensity
Achieved >€400 of per-vehicle cost reductions plus reduced CapEx intensity indicate structural improvement in unit economics. Platform standardization and lower supplier entry-ticket improve long-term margins and FCF conversion, enabling sustained investment in electrification while supporting profitability resilience.
Negative Factors
Material increase in leverage
A multi-fold jump in debt and a much higher debt/equity ratio materially reduce financial flexibility. Elevated leverage increases refinancing and interest-rate sensitivity, constrains strategic optionality and heightens downside risk if operational targets slip, making recovery dependent on consistent cash generation.
Profitability collapse and earnings volatility
A deep 2025 net loss and negative margins show profit volatility that undermines sustainable return generation. Structural recovery requires recurring operating improvements; one-off accounting charges and deconsolidation amplify volatility and reduce visibility on normalized earnings power over the medium term.
Weakened cash generation and negative free cash flow
A large decline in operating cash flow and a swing to negative FCF indicate cash conversion risk and volatility. Sustained weak cash generation impairs deleveraging, funds for EV investments, and dividend capacity absent asset sales or external financing, raising structural funding and strategic-execution risks.
Renault SA (RNLSY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$9.39B
Dividend Yield6%
Average Volume (3M)1.10K
Price to Earnings (P/E)―
Beta (1Y)0.66
Revenue Growth9.04%
EPS Growth-946.19%
CountryUS
Employees98,636
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Manufacturers
Share Statistics
EPS (TTM)0.21
Shares Outstanding1,478,610,000
10 Day Avg. Volume0
30 Day Avg. Volume1,103
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)0.46
Price to Sales (P/S)0.17
P/FCF Ratio-13.58
Enterprise Value/Market Cap6.20
Enterprise Value/Revenue1.00
Enterprise Value/Gross Profit5.27
Enterprise Value/Ebitda-10.32
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Renault SA Business Overview & Revenue Model
Company DescriptionRenault 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 MoneyRenault primarily makes money by selling new vehicles (passenger cars and light commercial vehicles) through wholesale to dealers/distributors and direct/other channels in certain markets, with revenue recognized from vehicle deliveries. A significant additional revenue stream comes from aftersales activities, including spare parts, accessories, and maintenance-related services tied to its vehicle parc. The group also earns revenue from services and other automotive-related activities (e.g., fleet and mobility-oriented offerings where applicable). In addition, Renault’s earnings can be materially influenced by its strategic relationships and equity interests, notably its alliance arrangements and stakes in other automakers; the financial impact of these may appear as income/loss from investments or related line items rather than consolidated automotive sales revenue. Specific contribution percentages by segment are not available.
Renault SA Earnings Call Summary
Earnings Call Date:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Jul 24, 2026
Earnings Call Sentiment Positive
The call presents a largely positive operational and financial picture: Renault Group delivered on its July guidance with a 6.3% operating margin, record automotive net cash of EUR 7.4 billion, resilient free cash flow (EUR 1.5 billion), accelerating electrified vehicle sales (EVs +72%–77% in Europe) and a record Mobilize Financial Services result. Product launches and international rollouts showed tangible traction. Key negatives are sizable non-cash accounting and provision items (notably the EUR 9.3 billion Nissan accounting loss), FX headwinds, H2 warranty/recall costs, and ongoing commercial/price pressure in Europe; these temper headline results but are largely manageable within the announced strategy. On balance, operational momentum, cash strength and clear midterm targets outweigh the transitory and structural headwinds.Q4-2025 Updates
Positive Updates
Operating Margin Delivered and Strong Profitability
Group operating profit of EUR 3.63 billion, representing a 6.3% operating margin (delivering July guidance). Automotive operating margin EUR 2.18 billion (4.2% of auto revenue).
Free Cash Flow and Net Cash Position
Automotive free cash flow of EUR 1.5 billion in 2025; Automotive net cash position at a record EUR 7.4 billion (up from EUR 7.1 billion year-on-year). Liquidity reserves at EUR 17.7 billion.
Revenue Growth
Group revenue EUR 57.9 billion, up 3% year-on-year (4.5% at constant exchange rates). Automotive revenue EUR 51.4 billion, up 1.8%.
Mobilize Financial Services (MFS) Record Performance
MFS revenue EUR 6.4 billion, up 13.2%. MFS generated a record operating profit of EUR 1.468 billion, up EUR 173 million year-on-year. New financing EUR 22.3 billion, average performing assets EUR 59.3 billion (+EUR 3.3 billion).
Vehicle Registrations and Unit Growth
Group registrations 2.3 million units, +3.2% (third consecutive year of growth). Order intake +3% and order book ~1.5 months of forward sales (1.7 months at end-Jan).
Strong EV and Hybrid Momentum
Renault brand EV sales in Europe +72%; Group EV sales in Europe +77%. Renault brand EV mix 20% (Europe), Group EV mix 14% (Europe). Full-hybrid sales +35% in Europe; Renault hybrid mix 38%, Group hybrid mix 30% (Europe).
Successful Product Launches and Regional Wins
Renault 5 >100,000 units sold in 2025; Symbioz ~89,000 units since launch; Dacia Bigster ~67,600 sold; Alpine achieved >10,000 sales (triple-digit growth). Regional successes: Grand Koleos ~44,000 (S. Korea); Kardian ~50,000 (S. America & Morocco); Duster ~27,000 outside Europe.
Cost Reductions Achieved
Average cost of goods sold reduction of over EUR 400 per vehicle in 2025, driven by purchasing performance and initial Horse powertrain synergies.
Lower CapEx Intensity
Group net CapEx and R&D at EUR 4.0 billion, representing 6.9% of revenue (down from 7.2% in 2024), aided by platform standardization and supplier entry-ticket reduction efforts.
Midterm Financial Ambition
Announced midterm guidance: target 5%–7% operating margin and over EUR 1.5 billion average annual free cash flow, plus continued annual EUR 400 variable cost reduction per vehicle and R&D/CapEx & supplier entry-ticket below 8% of revenue.
Negative Updates
Large Non-Cash Accounting Charge Related to Nissan
Other operating income and expenses negative at EUR 11.5 billion, including a EUR 9.3 billion non-cash loss linked to the change in accounting treatment of Renault Group's stake in Nissan recorded in H1 2025, contributing materially to below-the-line weakness.
Negative FX and Associated Profit Impact
Currencies had a EUR 282 million negative impact on operating margin (notably Argentinian peso and Turkish lira). Group revenue growth at constant exchange rates (+4.5%) outperformed reported growth (+3%) due to FX headwinds.
Commercial Pressure and Price/Mix Dilution
Price, mix, enrichment and cost factors combined negatively impacted results (EUR 341 million noted in bridge), driven by strong commercial pressure in Europe, higher EV mix, higher international sales mix and fewer high-margin LCV sales.
Warranty and Recall Costs
Higher warranty expenses in H2 2025 largely due to a powertrain recall campaign, increasing cost pressure and affecting operating profitability.
One-off Provisions and Impairments
Impairments of EUR 0.9 billion, restructuring costs EUR 0.4 billion, an additional EUR 222 million provision for the FCA/UK Motor Commission matter, and an EU CAFE LCV provision of ~EUR 100 million recorded in 2025.
Deconsolidation and Associated Earnings Volatility
Horse Powertrain deconsolidation caused a negative impact of EUR 279 million on the operating bridge in 2025 and associated companies' contribution was negative EUR 2.2 billion (including Nissan negative contribution).
Working Capital and Cash Flow Headwinds
Cash flow decreased to EUR 4.7 billion from EUR 5.2 billion in 2024. Change in working capital was a headwind of EUR 190 million in 2025 as the group unwinds the unusually positive EUR 844 million working capital effect recorded in 2024.
Regulatory & Market Risks (LCV BEV Mix and CAFE)
LCV electrification uptake lower than EU expectations; provisioned theoretical CAFE/LBV-related penalty of ~EUR 105 million for 2025. EU regulatory costs (e.g., Euro 6e) and potential local-content rules create additional cost and complexity.
Company Guidance
Renault guided 2026 to deliver an operating margin of circa 5.5% and free cash flow of about EUR 1.0 billion (including an expected EUR 350 million dividend from Mobilize Financial Services), assuming stable European markets and growth in South Korea, India and South America with consolidation of RNAIPL; the company also proposed a EUR 2.20 per‑share dividend for 2025. Over the midterm Renault targets a 5–7% group operating margin, steady mid‑single‑digit revenue growth and average free cash flow >EUR 1.5 billion per year, supported by annual cost reductions of around EUR 400 per vehicle, R&D/CapEx and supplier entry ticket below 8% of revenues, up to a 40% reduction in new‑project entry ticket, MFS dividends normalizing to ~EUR 500 million p.a., and additional dividend contribution from Horse Powertrain beginning in 2027.Renault SA Financial Statement Overview
Summary
Despite strong revenue growth into 2025, results are weighed down by a sharp 2025 earnings collapse (deep net loss and negative margin), a significant leverage step-up since 2023 (debt-to-equity rising to ~2.2–3.3x), and deteriorating cash generation in 2025 with free cash flow turning negative.Income Statement
Revenue has grown steadily from 2021–2025, capped by a sharp jump in 2025 (2025 growth ~177%), showing strong top-line momentum. However, profitability is volatile: net margin swung from positive in 2023–2024 to deeply negative in 2025 (net loss of ~€10.9B; net margin ~-18.9%). Operating profitability also weakened in 2025 (EBIT margin ~6.0%) and EBITDA turned negative, which materially offsets the revenue growth strength.42
Neutral
Balance Sheet
Leverage increased dramatically: total debt rose from ~€15–17B (2020–2022) to ~€65–70B (2023–2025), and debt relative to equity moved from ~0.5–0.7x (2020–2022) to ~2.2–3.3x (2023–2025). Equity declined in 2025 versus 2024, and returns to shareholders turned sharply negative in 2025 (return on equity ~-52.6%), indicating meaningful balance-sheet risk and reduced cushion if operating conditions weaken.33
Negative
Cash Flow
Cash generation weakened materially in 2025: operating cash flow fell to ~€2.34B from ~€7.16B in 2024, and free cash flow turned negative (~-€0.71B) after being strongly positive in 2024 (~€4.20B). Free cash flow has been volatile across the period (negative in 2021 and 2025), and cash conversion vs earnings is not consistently strong—particularly in 2025, where large losses did not translate into strong cash inflows.40
Negative
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 57.92B | 56.23B | 52.38B | 46.39B | 41.66B |
| Gross Profit | 11.05B | 11.73B | 10.96B | 8.27B | 6.87B |
| EBITDA | -5.64B | 5.10B | 6.39B | 7.59B | 4.80B |
| Net Income | -10.93B | 752.00M | 2.20B | -354.00M | 888.00M |
Balance Sheet | |||||
| Total Assets | 121.01B | 129.37B | 121.91B | 118.32B | 113.74B |
| Cash, Cash Equivalents and Short-Term Investments | 19.28B | 22.09B | 20.20B | 22.36B | 22.82B |
| Total Debt | 68.94B | 70.27B | 65.08B | 14.91B | 15.94B |
| Total Liabilities | 98.71B | 98.26B | 91.28B | 88.78B | 85.85B |
| Stockholders Equity | 20.79B | 30.31B | 29.75B | 28.95B | 27.32B |
Cash Flow | |||||
| Free Cash Flow | -705.00M | 4.20B | 1.40B | 929.00M | -277.00M |
| Operating Cash Flow | 2.34B | 7.16B | 4.46B | 3.61B | 2.41B |
| Investing Cash Flow | -3.30B | -2.04B | -2.23B | -3.29B | -1.62B |
| Financing Cash Flow | -1.33B | -3.23B | -3.08B | -478.00M | -629.00M |
Renault SA Technical Analysis
Negative
7.88
Price Trends
7.49
Negative
7.84
Negative
8.15
Negative
Market Momentum
-0.30
Positive
30.02
Neutral
18.01
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RNLSY, the sentiment is Negative. The current price of 7.88 is above the 20-day moving average (MA) of 7.18, above the 50-day MA of 7.49, and below the 200-day MA of 8.15, indicating a bearish trend. The MACD of -0.30 indicates Positive momentum. The RSI at 30.02 is Neutral, neither overbought nor oversold. The STOCH value of 18.01 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RNLSY.
Renault SA Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
59 Neutral | $65.94B | 27.72 | 5.13% | 0.69% | -1.29% | -49.96% | |
59 Neutral | $32.83B | 9.64 | 4.09% | 4.19% | 0.32% | -25.51% | |
55 Neutral | $18.22B | 109.05 | 1.55% | ― | -9.99% | -54.75% | |
50 Neutral | $19.02B | -7.49 | -66.53% | ― | 28.21% | 44.43% | |
48 Neutral | $46.72B | -6.38 | -18.91% | 5.64% | 3.75% | 33.37% | |
44 Neutral | $9.39B | -0.88 | -53.75% | 6.00% | 9.04% | -946.19% |
* Consumer Cyclical Sector Average
RNLSY
Renault SA
6.48
-3.77
-36.77%
F
Ford Motor
11.71
2.28
24.11%
GM
General Motors
72.95
24.44
50.39%
HMC
Honda Motor Company
25.70
-3.08
-10.70%
LI
Li Auto
18.24
-9.11
-33.31%
RIVN
Rivian Automotive
15.33
4.31
39.11%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.