(Alliance News) - After Friday's 25% plunge on June 6 and a tentative rebound on Monday, Stellantis attempted to recover: the stock climbed as much as 6% on the Milan Stock Exchange, closing up 3.4%. However, gains were capped by a double downgrade from Moody's and S&P.
As reported by Milano Finanza on Wednesday, the recovery remains fragile following write-downs exceeding EUR22 billion linked to its electric vehicle business.
Brokerages are updating their forecasts: Wolfe Research has moved its rating to "in line," seeing fewer short-term risks; RBC is more cautious, with a target of EUR6. HSBC maintains a 'hold' with a target price of EUR7, while UBS reiterates 'buy' but cuts its target to EUR9.7. Oddo BHF drops to EUR7 and highlights uncertainties in Europe, emerging markets, and for 2026.
In North America, competition, pricing, tariffs, and raw materials are weighing on the outlook. Free cash flow is still expected to be negative in 2026, and a potential hybrid issuance of up to EUR5 billion remains on the table to defend the rating.
The hardest blow came on creditworthiness: S&P cut its rating to 'BBB-' with a Negative outlook; Moody's to 'Baa3', just one notch above 'junk,' though with a Stable outlook. The agency forecasts adjusted free cash flow to remain negative by EUR2.5 billion in 2026 after minus EUR8 billion in 2025, amid margin pressures and strategic reassessment.
Liquidity, financial flexibility, and the suspension of dividends continue to support the company's profile, but a recovery will depend on the success of new models and cost containment.
By Giuseppe Fabio Ciccomascolo, Alliance News senior reporter
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