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Listing of Volvo Cars puts focus on significant value gaps

The listing of Volvo Cars became a success after initial uncertainties about Chinese majority rule. Looking at the sector's valuation, Tesla alone accounts for about 60 percent of the combined market capitalization of nine car companies, including Toyota and Volkswagen.

While the P/E-ratio for the nine car-producing companies only stand at 8x, Tesla shares trade at a P/E-ratio of 146x (!). Another way of illustrating the valuation difference is when dividing the market capitalization for each of the nine companies with the number of cars sold in 2020; each "Tesla car" is priced at USD 2.2 million (!) Meanwhile, the median "price" for all nine auto-making companies is only USD 21,500. Volvo Cars hold 50 percent in Polestar, which bears some similarities with Tesla, although Polestar is earlier in its development.

We also look at the S&P500 Q3 reporting season, where 82% of 280 reported so far has delivered earnings better than anticipated. Three out of six large tech stocks (out of which five in the FANG group) have reported since 19 October, where the was a significant positive reaction in three of them (Netflix, Alphabet-Google, and Microsoft).

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Carlsquare is a Pan-European research firm and financial advisor, focusing on M&A, Equity
Research and Growth Equity. Carlsquare has 70+ employees with deep sector knowledge in all 11
GICS sectors. The senior equity research team have an extensive experience about the stock
environment and several business sectors. The team produces company research reports,
independent valuations and trading notes. The group have offices in Berlin, Copenhagen,
Hamburg, London, Munich and Stockholm. Read more

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About Vontobel:

As a globally operating financial expert with Swiss roots, Vontobel specializes in wealth management, active asset management and investment solutions. Digital Investing bundles different investment solutions for private investors either directly or via ecosystems. Read more


Listing of Volvo Cars puts focus on significant value gaps

Författare MFN