Home » Porsche on the stock exchange, disappointing balance sheet one year after the huge listing

Porsche on the stock exchange, disappointing balance sheet one year after the huge listing

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Porsche on the stock exchange, disappointing balance sheet one year after the huge listing

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Exactly one year of P911, the Porsche stock ticker inspired by the most iconic model, on the Frankfurt Stock Exchange. On September 29, 2022, CEO Oliver Blume, who also leads the Volkswagen group, and number two, Lutz Meschke, rang the fateful bell in the trading room. It was the largest IPO in Europe since 2011 and in Germany (Telekom) since 1996, with a valuation of 75 billion and raising which reached 9.4 billion. Only three months later Porsche AG entered the main German stock exchange, the Dax. «Today – was Blume’s comment for the first birthday – we can say that our IPO was a huge success. It’s good for our customers, our shareholders and also our employees.”

The financial performance proves Blume right. Last year was, in his words, “by far the best in history”. A perhaps unrepeatable leap in profits due to the manufacturers’ price increase policy, made possible by the global slowdown in production (microchip and supply chain crisis) from 2021. Increase in sales of 13.6% (with growth especially in the United States and in China), operating profit rose +27.4%. Finally, a return on sales of 18%, from 16% in the previous year and from 14.6% in 2020. In the first half of 2023, revenues grew by 13% to 20.4 billion, a return on sales of 18.9% and operating result +10.7%. The Zuffenhausen company expects the margin to improve further, reaching 20 percent.

Some doubts, however, arise when observing the performance of the stock. Meschke had predicted a Porsche with a capitalization of over 100 billion. Prediction centered, but in the initial phase. The parable passed for a maximum of 120 euros, and then pointed downwards: -21.5% since August and only +6.5% since the debut. Yet, the Porsche stock had guaranteed an overall return of 26% only until the end of August, albeit lower than competitors such as BMW and Mercedes-Benz, not to mention Ferrari. All the houses mentioned suffered a summer decline. But not to the extent of Porsche.

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The reasons? Since the second half of the year, the automotive sector has been affected by the end of the driving force of orders, inflation and, increasingly, monetary policy. In the case of Porsche, however, according to some experts, there could be something more, even if the consensus of analysts remains positive on average. It is not a question of fundamentals, it is the hypothesis, but of lower perceived attractiveness in the medium-long term, in relation to the ability to generate, in the future, as much value with the electric range. And then China, which is worth 30% of global sales, but poses a thousand unknowns. Unjustified fears? Investors’ irrational fears? The results will tell. Starting with those of the expected electric Macan in 2024, arriving two years late due to the well-known problems of the Vw group’s Cariad unit on software development.

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