Renault (RNO) AI Stock Analysis

• Market Cap: €11.38B
• Dividend Yield: 5.6%
• Average Volume (3M): 1.03M
• Price to Earnings (P/E): 14.2
• Beta (1Y): 1.13
• Revenue Growth: 7.36%
• EPS Growth: -64.31%
• Country: FR
• Employees: 98,636
• Sector: Industrials
• Sector Strength: 85
• Industry: Auto - Manufacturers
• EPS (TTM): -2.00
• Shares Outstanding: 295,722,260
• 10 Day Avg. Volume: 1,236,109
• 30 Day Avg. Volume: 1,027,304
• PEG Ratio: 0.18
• Price to Book (P/B): 0.30
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 9.16
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €52.24
• Price Target Upside: 33.98% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 61 Neutral
• Price Target: €41.00 ▲(5.16%Upside)

Renault's overall score is primarily driven by solid financial performance, particularly in cash flow management. However, technical indicators highlight bearish momentum, impacting the stock's attractiveness. Valuation is reasonable with a strong dividend yield, but not enough to offset the weak technical signals.

Positive Factors

Cooperation and Partnerships

Cooperation with Geely continues to take shape, creating opportunities for growth and synergies.

Financial Position

Renault’s €7.1bn net auto net financial position positively surprised, and now equals approximately 50% of its current market capitalization.

Product Development

The upcoming Twingo BEV boasts a development time of less than two years and will have a price tag below €20k, making it a truly affordable BEV.

Negative Factors

CO2 Compliance

CO2 compliance was a bigger than feared overhang, impacting margins due to Renault's 18% EU share in light commercial vehicles.

Earnings and Liquidity

The analyst downgrades the stock to Hold due to reduced earnings and lower net liquidity.

Market Expectations

Renault's 2024 results and 2025 outlook are both towards the low end of market expectations, leaving no room for upgrades.

Renault Business Overview & Revenue Model

Company Description

Renault (RNO) is a French multinational automobile manufacturer established in 1899. The company is headquartered in Boulogne-Billancourt, France, and operates in the automotive industry, designing, manufacturing, and selling a wide array of vehicles, including passenger cars, commercial vehicles, trucks, vans, and electric vehicles. Renault is known for its innovation in automotive technology and has a significant presence in Europe and emerging markets. The company also has strategic alliances and partnerships, notably with Nissan and Mitsubishi, forming the Renault-Nissan-Mitsubishi Alliance, which enhances its global reach and product offerings.

How the Company Makes Money

Renault generates revenue primarily through the sale of its automobiles, which include passenger vehicles, commercial vehicles, and electric vehicles. The company’s revenue model is heavily reliant on vehicle sales, which are supported by a global network of dealerships and distribution centers. Additionally, Renault gains income from its financial services division, which provides financing solutions for vehicle purchases to both individual and corporate customers. The company also earns revenue from after-sales services, including vehicle maintenance and repair services, as well as the sale of automotive parts and accessories. Strategic partnerships, especially within the Renault-Nissan-Mitsubishi Alliance, enhance its research and development capabilities and allow cost-sharing, contributing positively to its earnings. Moreover, Renault is investing in new mobility solutions and technologies, including electric vehicle development and autonomous driving, which are expected to become increasingly significant revenue streams in the future.

Renault Financial Statement Overview

Summary

Renault exhibits solid revenue growth and cash flow performance, although profitability metrics suggest room for improvement. The balance sheet remains stable with moderate leverage, but enhancing return on equity will be key to maximizing shareholder value. Overall, Renault is navigating its financial landscape with positive cash flow momentum, while addressing profitability challenges.

Income Statement

Renault's income statement reflects a positive trajectory in revenue growth, with a 7.37% increase from 2023 to 2024. The gross profit margin is healthy at 20.78%, although the net profit margin is relatively low at 1.34%, indicating moderate profitability challenges. The EBIT margin of 4.58% and EBITDA margin of 10.54% suggest adequate operational efficiency, though improvements could enhance overall profitability.

Balance Sheet

The balance sheet shows a solid equity base with an equity ratio of 23.43%. The debt-to-equity ratio is 0.32, indicating reasonable leverage. However, the return on equity (ROE) is low at 2.48%, highlighting challenges in generating returns for shareholders. The company's financial stability is supported by a substantial cash balance.

Cash Flow

Renault demonstrates robust cash flow management, with a significant free cash flow growth rate of 194.11% from 2023 to 2024. The operating cash flow to net income ratio is strong at 9.52, indicating efficient cash generation relative to net income. Free cash flow to net income ratio is notably high at 5.47, reflecting excellent free cash flow conversion.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
56.23B	52.38B	46.39B	41.66B	43.47B
	Gross Profit
11.69B	10.90B	8.27B	6.87B	6.01B
	EBIT
2.58B	2.48B	2.60B	1.15B	-337.00M
	EBITDA
5.93B	6.39B	7.59B	4.80B	3.65B
	Net Income Common Stockholders
752.00M	2.20B	-338.00M	888.00M	-8.01B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
23.07B	20.20B	22.36B	22.82B	22.12B
	Total Assets
129.37B	121.91B	118.32B	113.74B	115.74B
	Total Debt
9.57B	65.08B	64.34B	61.96B	64.89B
	Net Debt
-12.97B	45.39B	42.57B	40.03B	43.20B
	Total Liabilities
98.26B	91.28B	88.78B	85.85B	90.40B
	Stockholders Equity
30.31B	29.75B	28.80B	27.32B	24.77B
Cash Flow		Free Cash Flow
4.11B	1.40B	929.00M	-277.00M	1.54B
	Operating Cash Flow
7.16B	4.46B	3.61B	2.41B	5.75B
	Investing Cash Flow
-2.04B	-2.23B	-3.24B	-1.62B	-4.23B
	Financing Cash Flow
-3.23B	-3.08B	-532.00M	-629.00M	5.59B

Renault Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 38.99
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FR:RNO, the sentiment is Negative. The current price of 38.99 is below the 20-day moving average (MA) of 44.64, below the 50-day MA of 44.62, and below the 200-day MA of 42.92, indicating a bearish trend. The MACD of -1.39 indicates Positive momentum. The RSI at 24.86 is Positive, neither overbought nor oversold. The STOCH value of 5.60 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FR:RNO.

Renault Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PEUG	75 Outperform	€1.83B	12.53	2.80%	3.80%	6.78%	7.28%
FR	74 Outperform	€2.22B	13.68	4.44%	4.61%	-2.50%	-26.84%
ML	67 Neutral	$22.70B	12.13	10.41%	4.29%	-4.06%	-4.47%
Sector *	66 Neutral	$4.49B	12.22	5.40%	3.71%	4.17%	-11.97%
RNO	61 Neutral	€11.38B	14.23	2.50%	5.60%	7.36%	-64.31%
FRVIA	60 Neutral	€1.64B	10.39	-4.21%	6.00%	-1.00%	-181.16%