- We believe Daimler’s EBIT margin has deteriorated in the wake of the new regulation and tepid pricing.
- But EBIT margin is seen to have recovered in part because of strong EV sales last year.
- Going forward, we believe that the catalysts for margin improvement include more favorable pricing, car sales recovery, and strong EV sales.
- The stock rally is understandable given the long-awaited margin recovery, but we are unsure now is the best timing for an entry point.
- The investment risks include no government incentives and insufficient infrastructure, risks that could weaken EV sales.
For further details see:
Daimler's EV Sales Surge May Have Supported Margin Recovery