Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on PEUGEOT SA. We currently have 23 research reports from 1 professional analysts.
Frequency of research reports
Research reports on
OPEL/Vauxhall takeover without proper due diligence?
06 Mar 17
PSA will buy 100% of the company’s production plants for €1.32bn and the financing arm’s 50/50 joint-venture with BNP Paribas* will buy OPEL’s financing activities for €0.9bn, i.e. PSA’s cash payment will amount to €1.87bn. This will be financed by cash (c. €1.1bn) and by warrants issued to GM (€0.65bn). The issue of the warrants has to be approved by the upcoming AGM on 10 May and, if the issue is rejected, PSA will pay this amount over a period of five years. The warrants carry a reference price of €17.34 and if these are converted into PSA shares, GM has agreed to sell the shares within 35 days after the exercise date. *most other financing activities are joint-ventures with Santander Consumer Finance.
First 2016 indications are good, but future margin to be lower
23 Feb 17
PSA seems to have delivered what we had expected and a bit more. The dividend of €0.48 (we had expected €0.30) is the major and positive surprise. Car deliveries of 3.15m were in line with our projections while consolidated revenue of €54bn was just ahead of our €53bn. Operating income of €2.61bn is about €100m higher and net earnings after minorities of €1.73bn are €63m higher. In fact, net earnings were only up as tax charges fell from €706m in 2015 to €517m, while at-equity profits were also down from €437m to €128m. In 2015, at-equity earnings from China alone were €300m.
One of the worst takeover mistakes
20 Feb 17
… is to keep the management team of the target unchanged. Takeovers are often unsuccessful and one mistake in these instances has been not to change management. PSA seems to be willing to make this mistake simply to keep German politicians and unions calm. In fact, Opel’s CEO has indicated that the company will stay independent from the parent company, at least for a while. But this management team has shown in the past that it cannot turn Opel around. One might argue that this is the result of GM’s policy to prohibit Opel from selling its cars, in sizeable quantities, outside Europe. However, this is only half of the problem. The other is that the car producer has not been able to turn its bottom line around at a time when the European market was booming, i.e. either costs were too high or prices too low. What is going to happen if demand softens again? The competition in prices will then intensify yet again and Opel’s losses will rise. As PSA is also not immune to this (both are selling the same types of cars and are going for the same clients), the combined group is likely to experience another severe setback.
PSA willing to buying an asset-light company?
14 Feb 17
Rumours suggest that PSA is interested in buying Opel/Vauxhall from GM. At the beginning of the current decade, it was Magna that was interested but finally gave up. The reasons were manifold: the target was not allowed to sell its cars outside Europe and the company was not the owner of its own name and not of any patents. These were owned by GM and the parent company was not willing to give these rights up.
Asian business needs to be refocused
25 Jan 17
Except for Iran, PSA showed a dismal performance in Asia in 2016. Deliveries fell by 16% to 618,352 vehicles in China and 16% to 19,886 in India & Pacific. To improve penetration in the Indian market, PSA has now signed a cooperation agreement with CK Birla Group which is expected to start producing in 2020. PSA’s initial investment will be €100m. The first joint-venture will be holding a majority stake in a joint subsidiary with ‘HMFCL’ which will produce cars for distribution in India (initial capacity of 100,000 units). This partner is currently a joint-venture partner of Mitsubishi. The second 50/50 joint-venture is with ‘AVTEC’ and this will produce powertrains. CK Birla was known as Hindustan Motors which went bankrupt in 2013.
Falling deliveries in a booming market
11 Jan 17
Thanks to the inclusion of 233,000 vehicles produced by a joint-venture in Iran, PSA shows delivery growth of 5.8% to 3.15m vehicles for 2016. Excluding this number, deliveries were down by 2% to 2.91m. With the exception of Europe (+3.6% to 1.93m) and LatAm (+17% to 183,907), the regional picture shows falling numbers everywhere else when Iran is excluded. In fact, with a delivery fall of 16% to 618,352 in China & Southeast Asia, the group’s foothold seems to be coming under intensifying pressure there. We had expressed our doubts whether Dongfeng is the right partner to bring PSA’s Chinese position forward. This performance is the more disappointing when looking at the Chinese market growth rate of more than 15% in 2016. Unfortunately, the group is not giving any explanation for the European discrepancy between registrations and deliveries. Through to November 2016, registrations were up by only 0.8% to 1.37m vehicles in the EU and EFTA countries and the performance was not much different in Europe’s largest markets in December (full-year European numbers will be out on 17 January). As a result, we believe that PSA’s inventory has increased considerably at the dealer network.
19 Apr 17
Lombard Risk Management* (LRM): Beats demanding growth and profit forecasts (CORP) | Frontier Developments* (FDEV): Steaming ahead (CORP) | Tax Systems* (TAX): Right place, right time (CORP) | Acal (ACL): Stronger H2 and brighter outlook (BUY) | Fenner (FENR): Interim results signal upgrades (BUY) | Minds + Machines* (MMX): US and Europe domain sales (CORP)
Small Cap Breakfast
24 Apr 17
Global Ports Holding—Intention to float on Standard List of the Main Market. International cruise ports operator. Seeking $250m raise including $75m primary offer. Dorcaster—Schedule One Update. Admission now expected on AIM 3 May. RTO of Escape Hunt raising £14m at 135p. Verditek— Intention to float on AIM. On Admission, the Company's subsidiaries will be involved in advanced solar photovoltaic, filtration and absorption technologies specialising in providing environmental services. Raising £3.5m. Admission in May. Eddie Stobart Logistics— Schedule 1 update. Admission expected 25 April on AIM raising £122m. ADES International Holding— Intends to join the Standard List of the Main Market in May raising up to $170m plus a vendor sale. Provider of offshore and onshore oil and gas drilling and production services in the Middle East and Africa. Admission expected in May. Tufton Oceanic Assets– Offer extended to 9 May on specialist funds segment of Main Market to enable investors to complete further due diligence.
Mature market growth still negative, despite beat in Q1
20 Apr 17
Unilever (ULVR LN, HOLD, T/P 3800p) released their Q1 trading statement this morning – Q1 underlying sales grew 2.9%. Turnover increased 6.1% to €13.3bn, in front of Bloomberg consensus of €13.2bn. Despite trading market conditions being described as tough, Unilever grew pricing by 3.0%, but saw volume declining 0.1%.