For the first time in the last 10 years, Renault has incurred losses in 2019: 141 million € against the profits of 3,300 million € in 2018. Renault´s stock price went down by 60% in the last 6 months (58.-€ vs. 23.-€).

The French group did not share its restructuring plan yet, however it may include some plant closing to save more than 2.2 billion €. Unluckily for Renault, it is one of the most affected automotive companies by the coronavirus or COVID-19. This is because of its production plant in China is located in Wuhan. Moreover, the decrease in net sales by 125,000 units, added to the world´s most famous runaway of Carlos Ghosn did not help to improve the difficult situation of the French car-maker. Last but not least, Renault does have a 3.1% stake in the capital of Daimler, car-maker which is, in turn, struggling with its results in 2019.

As you may already know, the Nissan-Renault Alliance means synergies for both car-makers. where the French company owns 43% of Nissan’s capital. Similarly, Nissan also incurred losses end of last 2019, meaning that Nissan´s contribution to Renault has decreased from 1,510 million € to 242 million € – compared to the previous year.

Carlos Ghosn Renault Zetsche Daimler

As an investor, I am sure you might be a bit worried about your dividend yield this year. In fact, the cash output in 2020 (based on 2019 results) will be drastically decreased to 1.1.-€ per share. Considering a dividend per share of 3.55.-€ last year – dividend yield of 10.75% – it does not seem to be a great year for the investors.

On the positive side, could Renault become a Top stock to watch and buy in 2020 by looking at its current market price? Depending on your investment strategy, I might recommend you to include this stock in your portfolio. Big opportunities to recover its price and get some profits? According to MarketScreener, Renault´s target price is at 41.46.-€ as of today. That means more than 80% of rising! 

Renault incurred losses

Renault might be struggling for a few more years, given a very strict restructuring plan to save more than 2.2 billion. You can stay in or runaway! Would you like to share with all of us what you would do? 

 

Juan Carlos Hoyos Saez Administrator
Passionate about Cars, Driving and Business. My objective is to inspire more and more car lovers. Racing, Kickboxing, traveling, and healthy life. Sub-project leader as a Material Cost/Project Controller, Daimler Trucks Asia (Tokyo, Japan).
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