BMW: New Launches Could Provide Support, But China Turnaround Remains Elusive

研报英文原文证据摘录

BMW: New Launches Could Provide Support, But China Turnaround Remains Elusive

BMW

Target/Upside/Downside Scenarios Investment summary

BMW is better positioned on US trade disputes than manyBMW

other German OEMs given its cross-trade dynamics. That said,

130 125 Weeks 20DEC23 - 12MAY26 it does have significant US trade exposure.

110 BMW is well positioned on EVs. Given its premium offering,

100 we don’t expect a significant negative impact on near-term

90 TARGETTARGET 84.0084.00 profitability from electrification as with mass-market players.

CURRENTCURRENT 80.6280.62 Further, we believe consumer EV demand in Europe is strong 70

60 and will continue to strengthen as European OEMs approach

50 CO2 emission targets.

15m

10m 5m Potential catalysts

2024 2025 2026 • China auto sales D J F M A M J J A S O N D J F M A M J J A S O N D J F

BMW GR Rel. MSCI EUROPEAN INDEX MA 40 weeks M A M • EV profitability

Source: Bloomberg and RBC Capital Markets estimates for Target • US trade resolution

Valuation Risks to rating and price targetOur €84 price target is derived by applying a 2.0x trough • BMW China performance worsensmultiple to our 2026E Industrial EBITDA. We then add • Lack of EV consumer demandIndustrial Net Cash, Finco (at 0.7x Book Value), and subtract • Battery prices do not fall and profitability is impairedMinorities (at 8x peer P/E) and Unfunded Pension liabilities to • US trade situation worsensarrive at our Equity Value. Our price target supports our Sector • Inventory issuesPerform rating.

Upside scenario

Our €108 upside value is derived by applying a 3.0x (historical

peak multiple) to our 2026E Industrial EBITDA. We then add

Industrial Net Cash, Finco (at 0.7x Book Value), and subtract

minorities (at 8.0x peer P/E) and Underfunded Pension