8. Stellantis N.V. (NYSE:STLA)
Number of Hedge Fund Holders: 24
Stellantis N.V. (NYSE:STLA) is a global automotive giant involved in designing, engineering, manufacturing, and distributing automobiles, light commercial vehicles, engines, and mobility services. The company has also ventured into autonomous driving, introducing its AutoDrive platform in 2021, and aims to become the first U.S. carmaker to offer Level 3 autonomous driving by 2025.
In July, the company unveiled a suite of new technologies set to redefine its vehicle lineup, all powered by artificial intelligence and poised to shape the future of its brands. Among these innovations are STLA Brain and STLA SmartCockpit, which first debuted with the Chrysler Airflow concept in 2022. However, the spotlight is now on STLA AutoDrive, a system promising Level 4 autonomy in the upcoming Halcyon concept. AutoDrive is set to begin its commercial rollout next year, replacing the current Hands-Free Active Driving Assist system and marking a major step forward in autonomous driving capabilities.
On the other hand, the company reported a significant decline in its third-quarter performance, with shipments falling 20% to 1.15 million units and revenues dropping 27% to €33 billion. CFO Doug Ostermann acknowledged these challenges, highlighting Stellantis’s focus on boosting profitability and adapting to market changes through a multi-year product transition plan. Stellantis N.V. (NYSE:STLA) also announced a strategic partnership with Leapmotor and collaboration with Infineon Technologies AG to enhance power conversion and distribution for electric vehicles.
On December 2, Stellantis N.V. (NYSE:STLA) shares were maintained with a Hold rating from HSBC following the unexpected resignation of CEO Carlos Tavares. Despite the leadership shift, the company reaffirmed its fiscal year 2024 financial guidance, initially released on October 31. The guidance projects an adjusted operating income margin between 5.5% and 7.0%, with HSBC estimating the lower end at 5.7%. The forecast for industrial free cash flow (FCF) ranges from negative €5 billion to €10 billion, with HSBC’s projection at approximately €8.5 billion.
Ariel Investments mentioned Stellantis N.V. (NYSE:STLA) in its Q2 2024 investor letter. Here is what the firm said:
“Finally, multinational automotive manufacturing company, Stellantis N.V. (STLA), fell in the quarter as higher interest rates in the U.S. and tapering demand for high-volume combustion engine models resulted in elevated U.S. inventory levels. Nonetheless, pricing outperformed expectations and management reiterated full-year guidance of double-digit adjusted operating profit margin and positive free cash flow. Although we expect discounting to increase as U.S. inventory ages, we maintain a constructive view on the company. We believe STLA’s strong global footprint and unwavering dedication to leading the industry in profitability, operational excellence, and strategic foresight will continue to enhance long-term shareholder value.”
