Following a comprehensive review, analysts at EuroAuto Research reaffirmed a Buy rating on MBGAF but trimmed their 12-month price target by 15% to €70. This adjustment reflects broader market volatility and a more cautious stance on global automotive demand. The revised target implies 20% upside from current levels, though it factors in a heightened risk premium given slowing industry growth.

MBGAF faces significant headwinds as electric-vehicle adoption rates in Europe and North America have decelerated from 30% year-over-year growth in 2023 to an estimated 18% in 2024. Meanwhile, lower-cost Chinese brands have captured an estimated 12% share of the premium EV segment in key markets, pressuring Mercedes-Benz’s margin profile. Analysts now assume Mercedes will deliver just 200,000 EV units in 2025, down from prior expectations of 260,000 units.

Management forecasts adjusted earnings per share (AEPS) will remain under pressure until the second half of 2026, with a full rebound to pre-pandemic levels not expected until 2027–2028E. Consensus AEPS estimates are €4.50 for 2024, €5.20 for 2025 and €6.80 for 2027. The delay is attributed to higher raw-material costs, extended supply-chain disruptions and ongoing R&D investment in next-generation powertrains.

Investors’ potential 20%+ annual rate of return hinges on Mercedes achieving a 9.5x P/E multiple by 2026 and executing its €2.5 billion cost-savings program on schedule. The plan includes 4,000 job cuts in non-manufacturing roles by year-end 2025 and streamlining global logistics networks. Failure to meet these targets could constrain valuation, while any upside surprises in EV pricing power or margin recovery would be the primary catalysts for multiple expansion.