BMW BMW.DE
What does BMW do?
BMW is a Munich-based premium manufacturer of automobiles and motorcycles. The company sells vehicles under the BMW, MINI and Rolls-Royce brands as well as motorcycles under BMW Motorrad. Spare parts, accessories and mobility services are also offered. Sales are conducted predominantly through independent dealers and branches worldwide.
The group earns its money in three segments: Automotive as the largest business, Motorcycles as a smaller segment, and Financial Services. The latter includes loan and lease financing, dealer and customer financing, insurance and service products as well as fleet management under the Alphabet brand. In competition, BMW faces mainly Mercedes-Benz and Audi in the premium segment, and increasingly also pure electric vehicle makers and Chinese providers. Its positioning rests on brand strength, a broad powertrain range from combustion engines through hybrids to electric, and a global production structure.
Score profile
Rank vs. Auto Manufacturers (10 companies). 10 = top of the group, 5 = middle. Calculated from the metrics below, without AI.
Metrics compared with the industry
On profitability and quality, BMW ranks above average in the group Auto Manufacturers (7.7/10). On growth, the company ranks below average in the group Auto Manufacturers (3.3/10). On valuation (higher = cheaper), the stock ranks in the middle in the group Auto Manufacturers (4.1/10). On financial strength, BMW ranks in the middle in the group Auto Manufacturers (5.6/10).
| Metric | Stock | Group median | Ranking |
|---|---|---|---|
| Forward P/E | 7.2x | 6.7x | better than 31 % |
| Trailing P/E | 5.8x | 25.9x | better than 92 % |
| PEG ratio | 1.3x | 0.6x | better than 36 % |
| EV/EBITDA | 10.5x | 9.6x | better than 36 % |
| Price/sales | 0.3x | 0.3x | better than 61 % |
| Price/book | 0.4x | 1.3x | better than 75 % |
| Revenue growth | -5.8% | -0.1% | better than 15 % |
| Earnings growth | 0.0% | 0.0% | better than 50 % |
| Gross margin | 12.2% | 11.8% | better than 55 % |
| Operating margin | 5.3% | 3.1% | better than 72 % |
| Net margin | 4.8% | 0.3% | better than 95 % |
| Return on equity | 6.3% | 0.3% | better than 85 % |
| Debt/equity | 120.7% | 131.9% | better than 55 % |
| Current ratio | 1.1x | 1.2x | better than 40 % |
| Free cash flow yield | 10.1% | 0.0% | better than 72 % |
| Dividend yield | 7.6% | 6.8% | – |
| Payout ratio | 43.5% | 61.4% | – |
| Beta | 0.81 | 0.96 | – |
Valuation: what is BMW worth?
Two valuation approaches – a discounted cash flow model and a valuation at the industry’s median multiples – give BMW a model range of 37.77 EUR to 130.06 EUR per share.
19 analysts, average rating “Hold”, average price target 67.04 EUR (+15.3%).
The full DCF matrix, the reverse DCF (what growth the price implies) and scenarios are part of the Pro analysis.
What the business depends on
- Demand for premium vehicles depends on the economy, consumer confidence and purchasing power in the main sales markets.
- Model mix, price realization and equipment variants largely determine the profitability of the automotive business.
- The financial services business provides stable income from financing and leasing, depending on interest rate levels and residual values.
Risks
- Trade barriers, tariffs and geopolitical tensions may weigh on sales, supply chains and margins in important markets.
- The shift to electric mobility requires high investment and carries uncertainty over the pace of demand and the intensity of competition.
- Stricter emissions regulations as well as recalls or quality problems may cause costs and damage the brand image.
What to look for with BMW
The EBIT margin in the Automotive segment shows how well price realization, model mix and cost control work together, independent of the earnings contribution from financial services.