Berenberg lowers Renault stock price target to EUR45 from EUR48, keeps Buy

Berenberg has reduced its price target on Renault SA (EPA:RNO) to EUR45.00 from EUR48.00, citing an H1 2025 profit warning and recent senior management changes creating uncertainty. Despite this, the firm maintained its 'Buy' rating, highlighting Renault's realistic 6.5% margin guidance for 2025, its insulation from broader industry concerns, and strong product momentum anticipated in 2025-26 due to new models and easing CO2 emissions regulations.

Analysis

Berenberg has adjusted its price target on Renault SA (RNO) to EUR45.00 from EUR48.00 but notably reaffirmed its 'Buy' rating, signaling a belief in long-term value despite near-term headwinds. The price target reduction is driven by an H1 2025 profit warning and recent senior management changes, which create uncertainty around an equity story previously defined by strong execution. However, the analysis frames this as a manageable challenge, viewing Renault's revised 6.5% margin guidance for 2025 as realistic and still competitive against European peers, including premium brands. A key part of the bull case is Renault's relative insulation from significant industry-wide pressures like tariffs, excess capacity, and exposure to the Chinese market. The outlook is further supported by anticipated strong product momentum in 2025-26, fueled by new models such as the Renault 5, Renault 4, and Dacia Bigster, and a potential regulatory tailwind from relaxed CO2 emissions rules in H2 2025.

Key Decisions for Investors

• Investors should weigh the near-term uncertainty from the H1 2025 profit warning and management turnover against the longer-term positive catalysts supporting the 'Buy' rating.
• Consider the stock's defensive characteristics, as Renault is positioned to be insulated from major industry headwinds such as tariffs and China market issues.
• Monitor the company's progress toward its revised 6.5% margin guidance for 2025 and the market reception of its new product pipeline, as these are critical validation points for the investment thesis.