London: The first analyst to cover Aston Martin Lagonda Global Holdings after the carmaker’s 2018 initial public offering has finally recommended buying the stock.
Jefferies’ Philippe Houchois lifted his rating to buy from hold, saying the British company’s net debt has stabilized and a refocus on traditional “front engine” cars like the DB12 and Vantage should benefit sales.
Houchois gave Aston Martin an underperform rating about a week after the firm’s trading debut five years ago. He questioned the lofty IPO price and also the use of share sale proceeds.
The stock plummeted over the next few years, but it’s soared 119 per cent in 2023, in part due to an investment from China’s Geely Automobile Holdings secured by Aston Martin’s billionaire chairman, Lawrence Stroll.
“I’ve always liked Aston Martin as a story, but the balance sheet was not balanced,” Houchois said by phone on Friday. “The situation is still tense, but Lawrence Stroll has managed to recapitalize without sacrificing the share price, which is quite skillful.”