DAIMLER

Analysis of Daimler share price

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Renault and Daimler: discussions underway for possible collaboration in large vans

04/02/2021 - 13h06

The French car manufacturer Renault has once again joined forces with the German Daimler Group. The two companies are holding discussions that could enable them to work together.

Elements that can influence the price of this asset:

Analysis N°1

We would notably follow closely all merger and acquisition operations launched by Daimler in relation to other companies, notably those in the Asian sector which is currently experiencing full growth and could therefore represent a positive growth boost for this group.

Analysis N°2

Daimler has also invested a lot of effort into remaining at the pinnacle of automobile technology and it is therefore important to monitor the different innovations developed by this group which enables it to effectively launch its new products. Daimler also tries to position itself in the highly promising sector of eco-friendly vehicles and plans to launch several series of hybrid cars over the coming years.   These specific vehicles also represent a supplementary source of revenue for the group.

Analysis N°3

We would of course keep an eye on the competition in this activity sector, notably on the major Japanese manufacturers that tend to develop vehicles of a quality close to that of Daimler with similar technologies but for sale at a lower price. These manufacturers could in fact easily take market parts from Daimler and thereby cause this company to lose money.  Also, this time relating to luxury vehicles, we can observe an incursion of new brands that could also create problems for the Daimler Company.

Analysis N°4

After the lack of interest displayed in regards to the Smart brand which was not received as warmly by the public as Daimler expected, we would also follow the possibility of any further setbacks for the company due to ill thought out acquisitions or ranges of vehicles that stray too far from the image of the traditional markets.

Analysis N°5

Finally, we would closely monitor the growth of the automobile industry in general and also changes in the global demand for this market. To do so there are several indicators to take into account such as the worldwide economic situation, the prices for fuel and any rise in demand from emerging markets or the markets where Daimler is already well established.

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General presentation of Daimler

Daimler is one of the leaders in the international car manufacturing market and number one in Germany. Its extremely large turnover is generated by various activities including vehicle sales, providing financial or insurance services, and of course motor vehicle manufacturing and production.

The vast majority of its activity is carried out in Germany and Europe, but its activity also extends to the United States, America and Asia.

Analysis of Daimler share price
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The major competitors of Daimler

You need to know and analyse Daimler's direct competitors in its industry as part of your analyses.

The BMW group 

a top-of-the-range, sporty and luxurious German automobile and motorcycle manufacturer which was also an aircraft manufacturer. This company is part of the BMW group and marketed over 2 million motor vehicles and 123,000 two-wheelers in 2018.

The Audi group

another car manufacturer in direct competition with Daimler that offers luxury and sports cars on the market. It's a subsidiary of the Volkswagen group which possesses 99.55% of the capital. The company is established in over 55 different countries worldwide and is present in most segments of the passenger vehicle market particularly thanks to its various subsidiaries such as Lamborghini or Audi Sport. The company is currently positioned among the most profitable companies in this sector of activity.

The Opel group

This is without probably the last direct competitor of Daimler and also of a German car manufacturer which is a subsidiary of the French group PSA and which was formerly a subsidiary of the General Motors group.


The major partners of Daimler

The Daimler group also started several partnerships with competing groups and from different activity sectors that you can check out here in more detail.

Renault & Nissan

For example, Daimler signed a partnership with Renault and Nissan in 2010 via an exchange of cross shareholdings which allowed them to pool the production of certain parts and allowing them to significantly lower their production cost, making them more competitive.

Bosch

More recently, in 2017, Daimler became partners with the Bosch group in a joint project to develop an autonomous vehicle which should take form in the years to come.

Uber

This type of autonomous vehicle project was also the subject of a recent partnership between Daimler and Uber in February 2017.

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The factors in favour of a rise in the Daimler share price:

Firstly, the fact that the Daimler Group is a company that exercises its activities on an international level is of course a highly positive point for its shares on the stock markets that thereby benefit from the interest from numerous traders.  At the present time, and mainly due to this company’s well managed expansion strategy, the Daimler Group sells its vehicles in over 200 different countries around the world. This particularity also has the advantage of effectively protecting the company from economic risks related to a single geographical zone and thereby any changes in demand in certain countries.

The stock market investors also appreciate Daimler’s highly diverse brand portfolio. The group does in fact represent other major automobile brand names such as Mercedes, SLK, Smart and Maybach. This diversity of brands notably enables this company to target different socio-economic client groups and thereby reach a higher number of automobile sales worldwide each year.

The factors in favour of a drop in the Daimler share price:

The fact that the Daimler Group overall produces less vehicles than its competitors could be viewed as a weakness in many ways.  Of course, this reduces the company’s sales and therefore the turnover but could also represent a handicap for innovation.  In fact, the suppliers that create innovative products tend to primarily produce them for the groups that achieve the highest number of sales and therefore buy the most.

The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions.

Frequently Asked Questions

Does the Daimler Group have any subsidiaries and which ones?

The Daimler Group conducts its business through various brands and subsidiaries which it owns and operates. These subsidiaries include Mercedez-Benz, Mercedes-Benz Trucks, Smart, Mitsubishi Fuso Truck and Bus Corportation (89.29% owned), Maybach, EyoBus with Mercedes Benz Bus, Setra and Motor Coach Industries. The group also owns Detroit Diesel Corporation, BharatBenz, Freightliner LLC with Western Star, Sterling Trucks and Thomas Buses, Car2Go and Mercedes AMG High Performance Powertrains.

How are the various Daimler shareholders distributed?

The capital of the Daimler Group is distributed among different types of shareholders, as follows. Firstly, 72.20% of the capital is held by institutional investors and 17.8% by private investors. 1.55% of the group's capital is held by Renault and 1.5% by Nissan. Of course, this breakdown is likely to change over time depending on the share transactions carried out by the company.

Is Daimler stock included in the DAX 30 stock market index?

Yes, the Daimler Group is currently included in the DAX 30, the German national stock market index. This means that it is one of the 30 German companies with the highest market capitalization. However, the company is also included in the composition of other leading stock market indices, such as the Euro Stoxx 50, the FTSE Eurotop 100 or the Stoxx Europe 50, and is therefore a high-value company.

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