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Volkswagen (VWAPY)
OTHER OTC:VWAPY
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Volkswagen
(OTC:VWAPY)
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Rating:57Neutral
Price Target:
$12.50
▲(4.43% Upside)
The score is held back primarily by weakening financial quality—especially persistently negative free cash flow and declining margins/returns with higher TTM leverage—despite supportive valuation (low P/E and high dividend yield). Technicals are mixed, with the stock in a longer-term uptrend but softer short-term momentum.
Positive Factors
Diversified brand portfolio & scale
Broad brand mix across mass-market, premium and luxury segments provides durable revenue diversification and pricing flexibility. Scale supports global supply chains, shared platforms, and high-margin after-sales services, cushioning cyclical shocks and aiding long-term competitiveness.
Resilient revenue base
Sustained mid-single-digit revenue growth and a steady gross margin (~18–19%) indicate a durable sales foundation. This steady top-line supports ongoing R&D and EV investments while providing recurring parts and services cash flows that stabilize earnings over the medium term.
Large, committed EV and tech investment
A multi-year EUR 160B investment program signals structural commitment to EVs, software and manufacturing transformation. Sustained capex and partnerships (R&D, AI, chips) can secure long-term platforms, scale advantages and technology ownership versus peers.
Negative Factors
Persistent negative free cash flow
Ongoing negative free cash flow constrains internal funding for capex and EV transition, forcing reliance on external financing or asset disposals. Over time this erodes financial flexibility, raises refinancing risk and can limit strategic investments or shareholder returns.
Rising leverage and falling returns
Higher leverage alongside materially lower ROE reduces the company’s buffer against cyclical downturns and raises interest and covenant risk. Deteriorating returns impair the firm’s ability to generate shareholder value from invested capital and constrain strategic optionality.
Erosion of China market position
Losing leadership in China — the largest global EV and volume market — undermines long-term growth and scale economics. Reduced market share weakens pricing power, local JV leverage and the ability to amortize EV investments, pressuring future revenue and margin recovery.
Volkswagen (VWAPY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$61.03B
Dividend Yield5.92%
Average Volume (3M)9.05K
Price to Earnings (P/E)8.5
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 Outstanding2,062,050,000
10 Day Avg. Volume7,841
30 Day Avg. Volume9,055
Financial Highlights & Ratios
PEG Ratio-0.12
Price to Book (P/B)0.24
Price to Sales (P/S)0.14
P/FCF Ratio-4.28
Enterprise Value/Market Cap4.68
Enterprise Value/Revenue0.88
Enterprise Value/Gross Profit4.93
Enterprise Value/Ebitda5.67
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 Business Overview & Revenue Model
Company DescriptionVolkswagen AG manufactures and sells automobiles primarily in Europe, North America, South America, and the Asia-Pacific. The company operates in four segments: Passenger Cars and Light Commercial Vehicles, Commercial Vehicles, Power Engineering, and Financial Services. The Passenger Cars and Light Commercial Vehicles segment develops vehicles, engines, and vehicle software; and light commercial vehicles; and produces and sells passenger cars and related parts. The Commercial Vehicles segment develops, produces, and sells trucks and buses; and offers parts and related services. The Power Engineering segment offers large-bore diesel engines, turbomachinery, and propulsion components. The Financial Services segment provides dealer and customer financing, leasing, banking and insurance, fleet management, and mobility services. The company also offers motorcycles. It provides its products under the Volkswagen Passenger Cars, Audi, KODA, SEAT, Bentley, Porsche, Volkswagen Commercial Vehicles, Scania, MAN, Lamborghini, Ducati, and Bugatti brands. Volkswagen AG was founded in 1937 and is based in Wolfsburg, Germany. Volkswagen AG operates as a subsidiary of Porsche Automobil Holding SE.
How the Company Makes MoneyVolkswagen generates revenue primarily through the sale of vehicles across its numerous brands. The company's revenue model is multifaceted, with key revenue streams including the sale of new vehicles, financing and leasing services, parts and accessories, and after-sales services. Volkswagen also benefits from strategic partnerships with technology firms to enhance its electric vehicle and autonomous driving capabilities, which are expected to drive future growth. Additionally, the company invests in research and development to innovate in electric mobility and digital services, positioning itself competitively in the evolving automotive market. Global demand for vehicles, particularly in emerging markets, and an increasing focus on environmentally friendly transportation solutions further contribute to its earnings.
Volkswagen 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 highlighted strong growth in electric vehicle deliveries and successful new model launches, particularly in Europe, which were overshadowed by significant challenges posed by U.S. import tariffs, a decline in operating results, and sales declines in North America and China. The company's efforts in cost management and restructuring are yielding positive results, but the financial impacts of tariffs and strategic adjustments continue to weigh heavily.Q2-2025 Updates
Positive Updates
Record BEV Growth
Deliveries of battery electric vehicles (BEVs) recorded strong growth, reaching 465,000 units, representing 11% of group deliveries and an increase of 47% year-over-year.
Successful New Model Launches
Numerous new model launches across all brands, including Volkswagen, Audi, Škoda, and Porsche, drove positive market reception and increased order intake, particularly in Western Europe with a 19% increase in orders.
Strong Performance of Škoda
Škoda achieved its best quarterly results with an operating margin of 9% and around EUR 740 million in operating profit, showcasing exceptional performance even in a challenging market.
Volkswagen Group's Leading Position in Europe
Volkswagen has a market share of 28% in BEVs in Europe, with 4 of the 6 best-selling BEVs in Europe coming from the group.
Negative Updates
Impact of U.S. Import Tariffs
The changed import tariffs in the U.S. resulted in expenses of around EUR 1.3 billion in the first half of the year, with potential costs of several billion if tariffs remain.
Operating Result Decline
Operating result declined by about 33% to EUR 6.7 billion, mainly due to increased tariffs, restructuring costs, and margin dilution from the ramp-up of electric vehicles.
Challenges in North America
Deliveries to North America customers fell by 7% due to the tariff situation, with a 16% decline in the second quarter alone.
Porsche's Decline in Sales Revenue
Porsche vehicle sales declined by 11%, with sales revenue dropping by 9% to EUR 16.1 billion, affected by battery-related activities and strategic alignment measures.
Company Guidance
In the Volkswagen AG Investor/Analyst and Media Call for the first half of 2025, key financial metrics and strategic updates were shared. Sales revenue remained stable at EUR 158 billion, while the operating result declined by about 33% to EUR 6.7 billion, resulting in an operating return on sales of 4.2%. The decline was attributed to increased U.S. import tariffs, which had a financial impact of around EUR 1.3 billion, and restructuring costs. The company reported a 1% increase in vehicle deliveries to 4.4 million units, with battery electric vehicle deliveries growing by 47% to 465,000 units, accounting for 11% of total deliveries. Volkswagen maintained its market leadership in Europe with a 28% share in the electric vehicle segment. The automotive net cash flow was reported at minus EUR 1.4 billion, influenced by restructuring expenses and investments. The company adjusted its full-year forecast, anticipating a stable revenue level and an operating return on sales between 4% and 5%, considering ongoing tariff challenges.Volkswagen Financial Statement Overview
Summary
Income statement is moderate (score 62) with resilient revenue but materially weaker profitability (net/operating margins down). Balance sheet is below average (score 55) with leverage rising in TTM and ROE declining. Cash flow is the key weakness (score 34) with persistently negative free cash flow since 2023 and weakening cash coverage versus earnings.Income Statement
Revenue has been resilient, with mid-single-digit growth in TTM (Trailing-Twelve-Months) (4.7%) after a very strong 2022–2023 rebound, but growth slowed materially in 2024. Profitability has compressed: net margin declined from ~5–6% (2021–2023) to ~3.5% in 2024 and ~2.2% in TTM, with operating margin also down versus 2022–2023 levels. Gross margin is relatively steady (~18–19%), suggesting the pressure is coming lower down the cost structure (operating/other items), which raises execution and cyclical risk.62
Positive
Balance Sheet
The balance sheet shows meaningful leverage for an auto manufacturer. Debt-to-equity sits around ~1.1x in 2022–2024 but worsened to ~1.6x in TTM, indicating either higher debt and/or lower equity recently. Returns on equity have trended down notably (from ~9–11% in 2021–2023 to ~6% in 2024 and ~4% in TTM), which reduces the cushion for a cyclical downturn. Scale is substantial (large asset base), but the recent leverage uptick and weaker returns temper the overall quality.55
Neutral
Cash Flow
Cash generation has weakened versus earnings quality. Operating cash flow is positive but has fallen relative to reported profits (coverage slipped from ~0.16–0.24 in 2021–2022 to ~0.07–0.09 in 2023–TTM). Free cash flow turned negative in 2023, stayed negative in 2024, and remains negative in TTM, with free cash flow also negative relative to net income—suggesting elevated investment needs and/or working-capital drag. The main strength is that operating cash flow remains positive, but persistent negative free cash flow is a key risk.34
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 325.86B | 324.65B | 322.28B | 279.05B | 250.20B | 222.88B |
| Gross Profit | 57.93B | 59.47B | 60.98B | 52.18B | 47.24B | 38.95B |
| EBITDA | 50.40B | 51.60B | 50.74B | 50.01B | 46.69B | 36.35B |
| Net Income | 7.12B | 11.35B | 16.53B | 15.46B | 15.38B | 8.87B |
Balance Sheet | ||||||
| Total Assets | 640.83B | 632.90B | 600.34B | 564.77B | 528.61B | 497.11B |
| Cash, Cash Equivalents and Short-Term Investments | 65.76B | 73.45B | 50.91B | 70.77B | 66.88B | 59.27B |
| Total Debt | 272.34B | 196.52B | 193.97B | 178.44B | 183.37B | 174.31B |
| Total Liabilities | 456.73B | 436.17B | 410.43B | 386.44B | 382.45B | 368.33B |
| Stockholders Equity | 169.63B | 182.29B | 175.69B | 165.38B | 144.45B | 127.05B |
Cash Flow | ||||||
| Free Cash Flow | -11.17B | -10.29B | -6.44B | 5.83B | 20.14B | 7.16B |
| Operating Cash Flow | 15.25B | 17.15B | 19.36B | 28.50B | 38.63B | 24.90B |
| Investing Cash Flow | -30.68B | -31.57B | -19.82B | -41.82B | -26.13B | -22.69B |
| Financing Cash Flow | 1.31B | 11.14B | 16.01B | 4.22B | -7.75B | 7.64B |
Volkswagen Technical Analysis
Positive
11.97
Price Trends
12.04
Positive
11.47
Positive
11.17
Positive
Market Momentum
0.05
Negative
49.75
Neutral
48.87
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VWAPY, the sentiment is Positive. The current price of 11.97 is below the 20-day moving average (MA) of 12.05, below the 50-day MA of 12.04, and above the 200-day MA of 11.17, indicating a bullish trend. The MACD of 0.05 indicates Negative momentum. The RSI at 49.75 is Neutral, neither overbought nor oversold. The STOCH value of 48.87 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VWAPY.
Volkswagen Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $295.05B | 9.79 | 12.51% | 2.57% | 7.28% | 12.41% | |
64 Neutral | $55.03B | 11.84 | 10.26% | 5.64% | 3.75% | 33.37% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | $1.58T | 392.16 | 4.89% | ― | -2.93% | -47.22% | |
58 Neutral | $40.86B | 10.05 | 5.23% | 4.19% | 0.32% | -25.51% | |
57 Neutral | $61.03B | 8.47 | 4.85% | 5.92% | 2.49% | -45.85% | |
57 Neutral | $76.18B | 25.78 | 4.34% | 0.69% | -1.29% | -49.96% |
* Consumer Cyclical Sector Average
VWAPY
Volkswagen
12.08
2.65
28.16%
F
Ford Motor
13.73
4.27
45.14%
GM
General Motors
85.71
37.64
78.30%
HMC
Honda Motor Company
30.58
4.14
15.67%
TSLA
Tesla
421.96
29.75
7.59%
TM
Toyota Motor
231.42
43.86
23.38%
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.