Despite the world automobile market is still, in terms of turnover, far from pre-pandemic levels, forecasts estimate a gradual recovery for the next few years, also driven by the recovery in the semiconductor supply chain.
Il automotive sectorin fact, represents one of the most important in the world, with a market value which is estimated at around 3 trillion dollars, a real pillar of the global economy; and after the collapse with the pandemic, the market is betting on a significant growth in demand.
However, there is no shortage of challenges with the sector which, in addition to chip shortagefaces procurement difficulties for other components, as well as significant ones increases in the price of raw materials.
Stop the sale of combustion cars
In June of last year, the Council of EU Environment Ministers announced a package of measures which include, among other things, the halt of the production of diesel and petrol cars, starting in 2035.
The goal is to fight climate change by decarbonising Europe, reducing CO2 emissions by 100%.
Here is the move has officially paved the way for the complete switch to electric motors and zero emissions, with all manufacturers already working hard to comply with the standard. In this sense, many Governments have introduced incentives for the purchase of electric cars, thus establishing ambitious objectives for their diffusion, so much so that the electric vehicle market is estimated to grow at compound annual growth rate of 39% by 2030.
The green turning point of Stellantis
In this context, Stellantis represents an interesting opportunity for investors. The group, created by the merger between FCA (Fiat Chrysler Automobiles) e PSA (Peugeot SA), represents one of the largest automotive companies in the world, with a global presence and a wide – diversified range of brands.
Stellantis presents a strong positioning in the European market and in North America and thanks to the continuous development of electric, hybrid and hydrogen vehicles, it is increasingly able to meet the needs of different customers in different market segments.
In addition, Stellantis has announced ambitious plans to roll out its electric vehicles, with the aim of selling the 30% electric vehicles by 2025. The group is investing heavily in research and development, improving technologies relating to batteries and recharging infrastructure, with the aim of making electricity increasingly convenient and accessible.
With this in mind this year Stellantis has reached the 15.7% share of electric vehiclesmarking an increase of + 1.7%, compared to 2021, the highest growth in the market, as well as an increase in the sales volume of low emission cars (LEV) of 31.4%.
In conclusion, we are in one phase of profound transformation for the automotive sector which is facing a series of challenges, but which at the same time also offers many growth opportunities for all companies in the supply chain.
Memory Cash Collect on individual titles
An alternative way of investing in the mentioned security is to use investment certificates, such as i Memory Cash Collect recently issued by BNP Paribas on the SeDeX of Borsa Italiana. These instruments are distinguished by the underlying which, after a series of issues on baskets of securities, returns to being in this issue on individual actionswhich can be some of the major Italian listed companies such as Stellantis, Eni, Enel, UniCredit, Nexi, Leonardo, Intesa Sanpaolo and Pirelli or European and American giants such as Apple, Paypal, Porsche, Airbnb and Netflix.
Memory Cash Collects on single shares therefore represent an alternative to direct investment in the underlying shares by offering potential quarterly bonuses with memory effect equal to a yield between 1.85% (7.4% pa) and 4.15% (16.6% pa) At maturity, these products guarantee nominal capital protection in the event of declines in the underlying share up to the barrier at maturity, between 60% and 70% of the initial value.
Quarterly premium of 2.15€ for the Certificate on Stellantis
To exploit the potential of the automotive sector, within the range of Certificates described above we find the Memory Cash Collect (ISIN NLBNPIT1KOJ2) on the security Stellar. On 13 March next, the product will pay a quarterly premium of 2.15 euros (equal to 8.6% per annum) if the Stellantis share is equal to or higher than the premium barrier, set at 60% of the initial value. In particular, the memory effect comes into play from the second valuation date (12 June 2023). This is a mechanism which allows the investor to receive a cumulative premium including all previously unpaid coupons if the conditions for receiving the premium are met on that valuation date. In addition, every three months starting from June 2023, the Certificate may expire prematurely if Stellatis quotes at a value equal to or higher than the respective initial value (2.0685 euros). In this case, in addition to the quarterly premium (2.15 euros) and the nominal value (100 euros), the investor also receives any previously unpaid premiums thanks to the memory effect.
The memory effect also comes into play if the Certificate it does not expire early and reaches expiration (fixed 12 December 2024). In this case, in fact, if the security is quoted at a level higher than or equal to the barrier at maturity (60% of the initial value), the Certificate pays the nominal value plus the premium (2.15 euro) plus any previously unpaid coupons . Otherwise, the product pays an amount commensurate with the security’s performance (lower than the barrier at maturity), resulting in a loss on invested capital.
Over 50% upside estimated by analysts
In Piazza Affari, the Stellantis stock suffered a lot last year (about -23% performance over the 12 months), reaching a low of more than one year in the 11 euro area on 6 July. From those levels a substantial recovery then started, dictated by the positive sentiment of the markets in general. Since the beginning of 2023, the shares of the Amsterdam-based builder have gained ground (+5% approximately, data as of January 20), also fueled by announcements in recent days to strengthen itself in electric mobility. According to the analysts of Equita Sim, who have included Stellantis among the top picks for 2023, as the stock trades at low multiples both in absolute terms compared to the forecasts of profits and margins for 2023-24 and in relative terms with a 40% discount on the average of European manufacturers. Indeed, among analysts there is a clear one prevalence of positive judgments on Stellantis stock, with 82% of those monitored by Bloomberg who have a buy recommendation, 18% say they keep the shares in their portfolio (hold) and nobody recommends a sell. The average target price indicated is 21.37 euros, approximately 52% above the levels at which Stellantis is now stationed in Piazza Affari.
WARNING
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