Halister News

(Bloomberg) -- Daimler said aftermarket yesterday that it won’t meet its 2016 Trucks guidance for flat operating profit, that it expects significant Ebit decline.

• Says global truck market, especially NAFTA, has worsened recently
• Says hasn’t changed group ongoing Ebit forecast for slight increase y/y
• Co. booking EU100m restructuring charge in Brazil, and charge in “mid hundreds of millions of euros” related to Takata airbag recalls

Exane (neutral)

• Truck profit guidance cut “long overdue”
• May revive fears about co. ability to manage through cycle
• Further warnings likely in “twilight” of cycle, Mercedes guidance may also be in doubt after weak 1Q
• Staying neutral because of value only

DZ Bank (hold)

• Puts another question mark on Daimler’s margin target of 8% over the cycle at Trucks unit
• See risk of profit warning at Mercedes-Benz cars in 2H based on cautious statements regarding the U.S. car market recently

Barclays (equalweight)

• Co. finally decided to change “unrealistic” truck guidance, which hasn’t helped co. credibility recently
• Barclays already had est. 17% drop in trucks Ebit
• Takata-recall related charge EU500m is more bad news

Kepler Cheuvreux (buy)

• Fact that co. keeping group guidance unchanged suggests other divisions are running well
• Worries about U.S. truck market already reflected in shares
• PT cut to EU77 from EU82

Goldman (buy)

• “Well-anticipated” trucks forecast cut “rebases to expectations” and leaves room for positive surprise if end markets improve
• Enables Trucks investor day on June 7-8 to “strike a more constructive tone”

NOTE: Stock is down 26% YTD vs 18% fall in the SXAP index

• Has 25 buy ratings, 10 hold, 0 sell; average PT of EU80 implying ~39% upside