10 Oversold Growth Stocks to Invest In

7) Stellantis N.V. (NYSE:STLA)

Forward P/E (As of 14 October): 3.46x

% Decline on a YTD Basis: ~42%

Number of Hedge Fund Holders: 31

Stellantis N.V. (NYSE:STLA) is engaged in manufacturing and marketing automobiles and commercial vehicles.

While the Stellantis N.V. (NYSE:STLA) has been facing challenges, Wall Street remains optimistic about the company’s unique approach to the Chinese market. The company formed a JV with Leapmotor, which is a rising Chinese EV brand. The analysts expect that the strategic partnership targets to leverage China’s cost advantages in EV and battery production and expertise in software and connectivity technologies.

Stellantis N.V. (NYSE:STLA)’s strategy minimizes the direct EBIT exposure in China, which can help in limiting downside risk. It will also enable the company to benefit from the country’s manufacturing efficiencies and technological advancements.

Moreover, Stellantis N.V. (NYSE:STLA)’s product portfolio, mainly its iconic US brands Ram and Jeep, is regarded as a key enabler for long-term growth. These brands offer high-performance and quality interiors, offering a competitive edge in the broader market. As a result, the company sees customer loyalty and can command premium pricing.

Stellantis N.V. (NYSE:STLA) will continue to leverage and expand its competitive differentiators and remains optimistic about its operational and financial performance in 2025 and beyond. As per Wall Street, the shares of the company have an average price target of $22.19.

Ariel Investments, an investment management company, released its Q2 2024 investor letter. Here is what the fund said:

“Finally, multinational automotive manufacturing company, Stellantis N.V. (NYSE: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.”