Bailey Pemberton
3 min read
Stellantis has seen its share price fall hard in recent years, which leaves a basic question for investors who focus on fundamentals. Is the current market value still in step with the revenue this global automaker generates, or have expectations moved out of line with its sales base?
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Over the past 3 years the stock price has declined 76.1%, putting the spotlight on whether the market is reassessing how much it is willing to pay for Stellantis’ existing and future sales.
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Fresh product plans in Europe and the U.S., including expanded electric and hybrid offerings plus partnerships with Chinese and Indian manufacturers, can influence how quickly Stellantis turns its current sales footprint into higher or lower revenue over time.
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The analysts covering Stellantis have run their own numbers. See what analysts think Stellantis’s shares could be worth.
The issue now is whether Stellantis’ current share price is adequately supported by its sales when judged against the Fair Ratio benchmark.
If you are reassessing Stellantis after this long slide in its share price, it can help to compare it with other automakers by starting with a focused screen of 42 power grid technology and infrastructure stocks
Is Stellantis Still Cheap on Sales?
P/S suits Stellantis because investors are mainly paying for a large, global sales base rather than high reported earnings right now.
On this measure, Stellantis trades at a P/S of 0.1x, which is well below the auto industry average of 0.6x and far under the peer group on 2.9x. The Fair Ratio model, which looks at what multiple might fit Stellantis given its size, margins, sector and risk profile, also points to the current P/S being on the low side rather than stretched. Because Stellantis is pushing new concepts and partnerships around EVs in Europe and China, the gap suggests the market is valuing that revenue stream cautiously compared with similar automakers. That is the sort of mismatch some long term investors look for when they weigh a beaten up stock against its sales base. Explore the numbers behind Stellantis’s P/S valuation.
The Stellantis Narrative: What Would Justify Today’s Price?
Simply Wall St Narratives pick up where the valuation gap for Stellantis leaves off and spell out what kind of growth, profitability and earnings path would need to hold for the stock to look meaningfully cheaper or more expensive than today. Each scenario is set up as a thesis about Stellantis’ business that can be tracked over time rather than a one off snapshot, and these are available on Simply Wall St’s Community page.
