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Volkswagen (OTC) (VWAGY)
:VWAGY
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Volkswagen AG
(OTC:VWAGY)
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Rating:74Outperform
Price Target:
$13.00
▲(20.15% Upside)
Volkswagen AG's strong financial performance and attractive valuation are key strengths, supported by growth in electric vehicle deliveries. However, cash flow challenges and external pressures like U.S. tariffs and restructuring costs present risks.
Positive Factors
Electric Vehicle Growth
The significant growth in electric vehicle deliveries highlights Volkswagen's successful transition towards sustainable mobility, positioning it well in the evolving automotive market.
In-House Chip Development
Developing in-house chips enhances Volkswagen's technological capabilities, allowing better integration and competitive positioning in the Chinese market, crucial for long-term growth.
Strong Order Intake
The robust increase in order intake, particularly for battery electric vehicles, indicates strong demand and supports future revenue growth, reinforcing Volkswagen's market position.
Negative Factors
Negative Free Cash Flow
Negative free cash flow highlights cash management challenges, potentially limiting Volkswagen's ability to invest in growth initiatives and impacting financial flexibility.
Impact of U.S. Tariffs
The significant cost impact from U.S. tariffs pressures profitability and necessitates strategic adjustments to mitigate long-term financial risks.
Challenges in China
Declining deliveries and market share in China pose risks to Volkswagen's growth in a key market, requiring strategic initiatives to regain competitiveness.
Volkswagen AG (VWAGY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$56.89B
Dividend Yield6.27%
Average Volume (3M)4.51K
Price to Earnings (P/E)8.0
Beta (1Y)0.70
Revenue Growth2.49%
EPS Growth-45.85%
CountryUS
Employees639,608
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Manufacturers
Share Statistics
EPS (TTM)-0.11
Shares Outstanding2,950,898,200
10 Day Avg. Volume0
30 Day Avg. Volume4,510
Financial Highlights & Ratios
PEG Ratio-0.12
Price to Book (P/B)0.25
Price to Sales (P/S)0.14
P/FCF Ratio-4.38
Enterprise Value/Market Cap5.52
Enterprise Value/Revenue0.97
Enterprise Value/Gross Profit5.55
Enterprise Value/Ebitda6.26
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
Volkswagen AG Business Overview & Revenue Model
Company DescriptionVolkswagen AG (VWAGY) is a leading global automobile manufacturer headquartered in Wolfsburg, Germany. The company operates in multiple sectors within the automotive industry, including passenger cars, commercial vehicles, and electric mobility. Volkswagen's core products encompass a wide range of vehicles under various brands, such as Volkswagen, Audi, Porsche, SEAT, Škoda, and Lamborghini. The company is also actively investing in sustainable technologies and digital services to enhance its product offerings and address the evolving needs of consumers.
How the Company Makes MoneyVolkswagen AG generates revenue primarily through the sale of vehicles across its diverse brand portfolio. The company earns significant income from the sale of passenger cars and commercial vehicles, with a growing emphasis on electric vehicles (EVs) as part of its strategy to transition to sustainable mobility. Additional revenue streams include financing services through Volkswagen Financial Services, which offers leasing and loan options to customers. The company also benefits from partnerships with technology firms to develop innovative automotive solutions, such as autonomous driving and connectivity features. Furthermore, Volkswagen's commitment to manufacturing efficiency and cost management contributes to its profitability, while its global presence allows it to tap into various markets, driving sales and enhancing brand loyalty.
Volkswagen AG Earnings Call Summary
Earnings Call Date:Jul 25, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Mar 10, 2026
Earnings Call Sentiment Neutral
The earnings call reflected a mixed performance for Volkswagen in the first half of 2025. While there were strong achievements in electric vehicle deliveries, order intake, and operational improvements at certain brands like Škoda, significant challenges were posed by increased U.S. tariffs, restructuring costs, and market pressures in China. The overall financial performance was impacted by these issues, leading to a decline in operating profits and negative cash flow.Q2-2025 Updates
Positive Updates
Stable Sales Revenue
Volkswagen Group generated sales revenue of EUR 158 billion in the first half of 2025, on par with the previous year.
Increased Deliveries of Electric Vehicles
Deliveries of battery electric vehicles reached 465,000 units, representing an increase of 47% and a 20% BEV sales share in Western Europe.
Strong Order Intake
Order intake in Western Europe increased by 19%, with BEV orders rising by 62%.
Record Performance by Škoda
Škoda achieved the best quarterly results in its history with an operating margin of 9% and EUR 740 million in profits.
Significant Workforce Reduction
Over 4,000 employees left Volkswagen since the end of last year, with a further 20,000 departures contractually agreed, expecting annual savings of over EUR 4 billion.
Negative Updates
Decline in Operating Profit
Operating profit for the first half of 2025 declined by 33% to EUR 6.7 billion, primarily due to U.S. tariffs and restructuring costs.
Impact of U.S. Tariffs
Increased U.S. import tariffs resulted in expenses of around EUR 1.3 billion in the first half of the year.
Drop in Porsche Sales
Porsche vehicle sales declined by 11%, with sales revenue dropping by 9% due to battery-related activities and U.S. tariffs.
Challenges in China
Deliveries in China declined by 2%, and the BEV market share decreased to 4.5%.
Negative Free Cash Flow
Net cash flow in the automotive sector amounted to minus EUR 1.4 billion in the first half of the year.
Company Guidance
In the recent Volkswagen AG half-year conference call, the company provided updated financial guidance and discussed key performance metrics for the first half of 2025. Volkswagen reported stable sales revenue of EUR 158 billion, with operating results impacted by increased U.S. import tariffs and restructuring costs, leading to a 33% decline in operating profit to EUR 6.7 billion. The operating return on sales dropped to 4.2%, but excluding tariff and restructuring impacts, it was 5.6%. The company highlighted strong progress in their BEV segment, with deliveries increasing by 47% to 465,000 units. Volkswagen has adjusted its full-year outlook, anticipating revenues to match the previous year's levels and projecting an operating return on sales between 4% and 5%, factoring in potential tariff scenarios. The call emphasized the need for Volkswagen to intensify cost-cutting efforts and highlighted ongoing investments in North America, including over USD 14 billion in local production and technology advancements.Volkswagen AG Financial Statement Overview
Summary
Volkswagen AG shows strong revenue growth and profitability, with a robust balance sheet. However, cash flow challenges due to high capital expenditures and negative free cash flow need attention.Income Statement
Volkswagen AG has demonstrated consistent revenue growth and maintains strong gross and net profit margins. The gross profit margin stands at 18.31%, and the net profit margin is at 3.50% for the latest year. Despite a decline in EBIT, the company shows a healthy EBITDA margin of 15.90%. Overall, the income statement reflects solid profitability with minor fluctuations in EBIT over recent years.82
Very Positive
Balance Sheet
The balance sheet of Volkswagen AG is robust with a steady increase in stockholders' equity and total assets. The debt-to-equity ratio is 1.08, indicating a moderate level of leverage. The equity ratio is 28.80%, suggesting a stable financial structure. Return on equity is 6.23%, demonstrating reasonable profitability relative to equity.79
Positive
Cash Flow
Volkswagen AG's cash flow analysis shows challenges with free cash flow, which is currently negative. The operating cash flow to net income ratio is 1.51, indicating efficient operations. However, the free cash flow to net income ratio is negative due to significant capital expenditures, suggesting a need for improved cash management strategies.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 324.22B | 324.65B | 322.28B | 279.05B | 250.20B | 222.88B |
| Gross Profit | 56.55B | 59.47B | 60.98B | 52.18B | 47.24B | 38.95B |
| EBITDA | 50.16B | 51.60B | 50.74B | 50.01B | 46.69B | 36.35B |
| Net Income | 8.97B | 11.35B | 16.53B | 15.46B | 15.38B | 8.87B |
Balance Sheet | ||||||
| Total Assets | 637.68B | 632.90B | 600.34B | 564.77B | 528.61B | 497.11B |
| Cash, Cash Equivalents and Short-Term Investments | 62.91B | 73.45B | 50.91B | 70.77B | 66.88B | 59.27B |
| Total Debt | 188.15B | 196.52B | 193.97B | 178.44B | 183.37B | 174.31B |
| Total Liabilities | 439.67B | 436.17B | 410.43B | 386.44B | 382.45B | 368.33B |
| Stockholders Equity | 182.88B | 182.29B | 175.69B | 165.38B | 144.45B | 127.05B |
Cash Flow | ||||||
| Free Cash Flow | -11.10B | -10.29B | -6.44B | 5.83B | 20.14B | 7.16B |
| Operating Cash Flow | 15.98B | 17.15B | 19.36B | 28.50B | 38.63B | 24.90B |
| Investing Cash Flow | -30.54B | -31.57B | -19.82B | -41.82B | -26.13B | -22.69B |
| Financing Cash Flow | 74.00M | 11.14B | 16.01B | 4.22B | -7.75B | 7.64B |
Volkswagen AG Technical Analysis
Positive
10.82
Price Trends
10.98
Positive
11.27
Positive
10.98
Positive
Market Momentum
0.09
Negative
56.19
Neutral
49.72
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VWAGY, the sentiment is Positive. The current price of 10.82 is below the 20-day moving average (MA) of 11.14, below the 50-day MA of 10.98, and below the 200-day MA of 10.98, indicating a bullish trend. The MACD of 0.09 indicates Negative momentum. The RSI at 56.19 is Neutral, neither overbought nor oversold. The STOCH value of 49.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VWAGY.
Volkswagen AG Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $268.56B | 9.40 | 12.51% | 3.01% | 7.30% | 12.42% | |
75 Outperform | $67.89B | 14.63 | 4.44% | 0.93% | 2.58% | -46.27% | |
74 Outperform | $56.89B | 7.97 | 3.76% | 6.27% | 2.49% | -45.85% | |
74 Outperform | $52.56B | 11.31 | 10.26% | 5.69% | 3.75% | 33.37% | |
73 Outperform | $40.42B | 9.93 | 5.23% | 4.16% | 0.34% | -25.49% | |
73 Outperform | $1.42T | 285.03 | 7.03% | ― | -1.56% | -59.09% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% |
* Consumer Cyclical Sector Average
VWAGY
Volkswagen AG
11.36
2.90
34.28%
F
Ford Motor
13.19
2.83
27.32%
GM
General Motors
72.81
17.80
32.36%
HMC
Honda Motor Company
30.30
5.44
21.88%
TSLA
Tesla
426.58
81.42
23.59%
TM
Toyota Motor
202.44
31.81
18.64%
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.