Stellantis Shares Drop 4.36% and Approach Support Level Following Two Downgrades
On Tuesday, March 3, Stellantis NV saw a significant decline in a weakened European market environment due to geopolitical tensions in the Middle East. The automaker's stock fell by 4.36% to 6.161 euros by midday, dangerously nearing its technical support threshold. Two banks had simultaneously lowered their price targets on the stock the day before.
Impact of Downgraded Targets
Stellantis NV's stock is experiencing direct consequences from two target revisions published on Monday, March 2. Citi lowered its target from 9.00 to 8.00 euros while maintaining a neutral stance on the stock. Meanwhile, Bernstein made a more drastic cut, reducing its target from 8.50 to 6.20 euros with a market performance recommendation. Bernstein's target is just above the current price, suggesting only a marginal upside potential of about 0.6%. Conversely, Citi's target offers a theoretical margin of nearly 30% from the level of 6.161 euros. These adjustments are part of a pronounced downward trend: the stock has lost 50.19% over the past year and 32.5% over the last three months, reflecting the group's structural difficulties in a deteriorated sector environment. The annual general meeting scheduled for April 14 and the first-quarter results announcement on April 30 will be the next catalysts to watch for the automaker born from the merger between PSA and Fiat Chrysler.
Technical Analysis of the Day's Trading
Technically, today's session pushes Stellantis to the brink of its support level at 6.14 euros, a breach of which could lead to new lows. The stock is now significantly below its 20, 50, and 200-day moving averages (at 6.92, 8.15, and 8.52 euros respectively), confirming the dominance of the bearish trend across all time horizons. The gap of more than 27% with the 200-day moving average highlights the extent of the accumulated decline. The market context is not helping the stock. European stock markets are down this Tuesday by 1 to 3% following a surge in oil prices, with Brent crude jumping to 80.14 dollars a barrel due to military operations in Iran and the circumvention of the Strait of Hormuz by shipowners. The rise in energy costs is an unfavorable factor for the automotive industry, whose margins partly depend on the prices of raw materials and international logistics. For Stellantis, already facing a cycle of downward revisions, this surge in energy prices adds an extra layer of uncertainty to the short-term operational outlook.
