German stock Mercedes-Benz Group AG (DE:MBG) delivered a resilient performance in 2023 amid an EV slump in the industry. Though the company announced a delay of five years in its electrification target, it reassured its investors of its commitment to enhancing its combustion engine models. It has adjusted its projections of EV sales, including hybrids, which will comprise up to 50% of total sales by 2030 as compared to the previous target of 2025.
Post-results, the stock traded up by 4.7% on Thursday’s trading session. Year-to-date, the stock has gained over 12%.
Mercedes-Benz is among the leading luxury car manufacturers in the world.
Insights From 2023 Results
The group posted a 2% growth in its revenues of €153.2 billion in 2023 as compared to a year ago. However, despite the rigorous cost control measures, the EBITDA declined to €19.7 billion, down from €20.5 billion in 2022.
Among its divisions, the adjusted EBIT for Mercedes-Benz Cars amounted to €14.3 billion, compared to €16.2 billion in 2022. Despite benefiting from favorable factors such as net pricing, and reduced raw material prices, these gains were offset by increased inflation expenses and supply chain-related costs.
For 2024, the adjusted return on sales (RoS) is anticipated to fall within the range of a robust 10%-12%, driven by stable volumes and a sustained high proportion of top-end vehicle sales.
Is Mercedes a Good Buy Stock?
According to TipRanks’ consensus, MBG stock has received a Moderate Buy rating based on recommendations from 17 analysts. This includes nine Buy, seven Hold, and one Sell recommendations. The Mercedes share price forecast is €76.31, which is 6.7% higher than the current price level.
