The first thing to watch for is Renault's efforts to expand its strategic positioning from a geographical perspective, and in particular the operations aimed at increasing its presence in emerging markets where demand for cars is booming.
As the market for clean vehicles is also booming, attention should also be paid to operations aimed at creating new electric or hybrid vehicle models by the brand.
As for the indicators to watch for in a fundamental analysis of this stock, it will be important to follow with interest the data from the competition in this sector with the publications and results of the major car manufacturing groups.
News from the Nissan group, to which Renault is closely linked, is also impactful for this stock and should be followed closely.
It will also be necessary to follow the costs of financing the purchase of vehicles in the countries in which Renault markets its products the most and which will impact orders.
Finally, before buying or selling Renault shares, you should systematically check the company's financial results, including quarterly and annual publications and targets.
Renault is one of the world's largest car manufacturers, with a presence in more than 125 countries around the world. The company was founded in 1899 and has since established itself as a leader in the automotive market. Renault's major focus is on vehicle sales, which account for 93% of its annual turnover. In 2022, the group sold 2.1 million passenger and commercial vehicles, spread across its various brands, including Renault, Dacia, Alpine, EVeasy and Mobilize. Renault also offers services such as financing solutions, maintenance and assistance services, and mobility services.
With 34 industrial sites around the world, Renault is present on all continents and has a diversified geographical distribution of its turnover. France accounts for 29.8% of its turnover, Europe 47.1%, America 9.4%, Asia-Pacific 5.8%, Eurasia 4.1% and Africa and the Middle East 3.8%.
However, the company has faced challenges in recent years, including a decline in sales due to increased competition in the global automotive market and production issues. This has had an impact on the company's financial performance, with profits falling in 2020. To address these challenges, Renault has announced a restructuring plan that includes job cuts and cost reductions.
Despite these challenges, Renault has also taken steps to position itself in the electromobility market, with the launch of its ZOE electric car brand in 2012, as well as other electric and plug-in hybrid models. In addition, the company announced an ambitious plan to increase its market share in Asia, particularly in China, where it has created a joint venture with Dongfeng Motor.
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Let's now discover the economic and sectoral environment of the Renault group with a general presentation of all the competitors of this French car manufacturer.
First of all, we must of course take into account the competition from the Volkswagen Group, which is a German car manufacturer created by the German Labour Front under Adolf Hitler. For some years now, the Volkswagen group has been the world's leading manufacturer in terms of the number of vehicles sold per year.
The Toyota Motor Corporation group is a Japanese-based car manufacturer and also one of the leaders in the automobile sales sector worldwide. In fact, it is the most profitable in terms of sales in this sector. According to the Forbe Global 2000 ranking, Toyota was in 2017 the tenth largest company in the world. It is also worth noting that Toyota is in 2021 the largest car manufacturer in terms of market capitalization.
Of course, the competition from the American car manufacturer General Motors, also known as GM, will also be considered here. The latter is based in Detroit, Michigan, in the United States, and owns some 15 different vehicle brands. In the past, General Motors was the largest car manufacturer in the world from 1931 to 2005 and again in 2011.
This other car manufacturer belongs to the Korean conglomerate and is currently the only independent manufacturer in this sector in South Korea, where it is of course the number one.
Still among the major competitors of the Renault group, we find the Ford Motor Company or FMC which is an American car manufacturer based in Dearborn in the suburbs of Detroit, Michigan.
Finally, the last competitor you should definitely keep an eye on in your Renault share price analysis is Honda Motor Co which is a Japanese car manufacturer that also produces motorcycles, quads, scooters, business aircraft, electric generators, boat engines and gardening and DIY equipment. It is, of course, one of the world's leading manufacturers in this sector.
The Renault group is constantly seeking to create targeted partnerships with certain competing or complementary companies in order to maintain its position on the automotive market.
In 2016, it thus partnered with the Microsoft Group to develop a connected vehicle model using the most innovative computer technologies.
For a much longer time, Renault has had a partnership with the Elf brand of lubricants, a subsidiary of theTotalEnergies group, for the promotion of these products.
In 2015, the Renault group had also tried to create a partnership with the car manufacturer Mitsubishi, but eventually, the contract will be cancelled. This partnership aimed for Renault to provide three-box sedans to the Japanese group for its North American market.
More recently, in 2019, the Renault group also established a partnership with the PSG football club. This commercial partnership has resulted in the launch of a special series of the Mégane Gt-Line brand with a style reminiscent of the club's and an associated advertising campaign that is widely distributed on various media.
One of the greatest advantages of the Renault company is undoubtedly its position on the world car manufacturing market. Renault is currently the fourth largest manufacturer in the world and has a share of almost 10% of the world's cars, thanks to its Renault brand vehicles, but also to the Dacia and Renault-Samsung brands.
Another strong point is the company's effective strategy for developing its activities around the world, with an excellent distribution of activities between Europe, Russia, Turkey, Algeria and Latin America for the Renault brand, and in Europe and Asia for the Nissan brand.
The Renault group has shown strong growth in recent years. This is largely due to the low-priced entry-level vehicles offered by the Dacia Entry range. Renault has also been able to increase its growth by winning new market share abroad, particularly in India, China, Japan and Brazil, where it generates more than half its sales.
Renault is strategically well positioned in the Asian production market, which is highly prized by its main competitors. In particular, it has doubled its production capacity in South Korea, with an upturn in European registrations, which has enabled it to make real savings on costs. The group has also pooled the production facilities of its Nissan subsidiary with the Renault branch, once again helping to lower production costs and improve competitiveness. Thanks to this strategy, the group achieved an operating margin of 5.7% in 2015 and demonstrated its ability to control its distribution flows by sharply reducing its inventories.
Still in terms of international growth, the Renault group currently has a clear advantage over its competitors, since it was the very first car manufacturer to take advantage of the opening of the Iranian market.
Another major strength of the Renault group this time concerns its financial engineering, particularly with the successful share buyback of Nissan in 2016, which allowed the group to retain a large part of the shares of this subsidiary while generating several billion euros in 2016.
Thanks to its financial strategy and its efforts to reduce its debt, Renault should finally benefit from a rating upgrade by the main rating agencies and thus gain more confidence from investors.
Finally, investors who buy Renault shares also appreciate the direct distribution of dividends from the various holdings to the group's shareholders.
Firstly, it must be acknowledged that the introduction of the Entry range has not only brought benefits to the Renault group. It has indeed damaged the group's image and this new range could, in the long term, cannibalise the Renault and Dacia brands in the countries where the group is historically present. This new range also obliges Renault to increase its sales volumes considerably.
It is also noted that Renault brand vehicles generate insufficient profitability compared to Nissan brand vehicles, which could pose a problem in the longer term.
Another threat that the group will have to face in the coming years is the crisis in the automotive market in Russia, Brazil and Latin America, which is currently showing a strong decline.
Investors are also rather cautious about the success of the Renault group's strategy to develop all-electric vehicles, knowing that this market is considered very promising but also extremely competitive in a context of contestation of the validity of the anti-pollution systems of diesel cars in Europe and a willingness of governments to promote the purchase of clean vehicles.
Of course, it is also necessary to talk here about Renault's brand image, which has been heavily damaged by the Carlos Ghosn affair that shook the stock at the end of 2018 and the beginning of 2019. The head of the group is indeed accused of significant tax fraud and this has created many conflicts with the head of Nissan, putting a strain on this association between the two brands.
Strong, higher than expected demand coupled with high launch costs could also weigh on Renault's medium and long-term profitability.
Finally, we should also point out that the Renault group regularly faces conflicts between the company's board of directors and the French state, which is still a shareholder in the group.
Although the Renault group shows both strengths and weaknesses here, it is important to take these into account before buying or selling this stock.
Renault shares are currently listed on the Paris Stock Exchange, i.e. on the Euronext market. It was first listed on November 17, 1994, when the company decided to open up its capital. At the time of this public offering, the price of a Renault share was 165 francs or 25.15 euros. More precisely, this share is listed in compartment A of this stock market, i.e. in the section for companies with the highest capitalization.
Of course, as you probably already know, Renault shares are currently included in the French benchmark CAC 40 stock market index, and have been since February 9, 1995, because they are one of the 40 French companies with the largest capitalization. But this is not the only index that takes into account the value of this share, since the Renault group is also part of the composition of other stock market indices such as the SBF index, the Euronext index, the Euronext Auto index, among others.
To know how the Renault share is likely to evolve in the more or less long term, you need to know its history and, more precisely, the record levels it has reached since its first quotation. For example, the lowest price was recorded in March 2009 at €10.56 while the highest price was recorded in July 2007 at €122.87.
The price to buy a Renault share varies according to the fluctuations of the stock market and the offers and demands of investors. It is therefore likely to change at any time. It is possible to follow the evolution of the Renault share price in real time by consulting specialised stock market websites or by using market monitoring applications. Over the last 10 years, the share price has fluctuated between 10 and 100 euros on average. It should be noted that buying shares is a risky investment, as the share price can fluctuate depending on many economic and financial factors, including the company's financial results, growth prospects, regulatory developments and competition. It is therefore advisable to conduct a thorough analysis before buying or selling Renault shares, taking these factors into account and basing your decision on reliable and up-to-date information.
