BMW Faces Similar Challenges To Other German Automotive, But Offers Good Valuation

Summary

• BMW faces declining sales and margins, especially in China, due to commoditization and competition from Chinese manufacturers, impacting its luxury brand value.
• Despite challenges, BMW's strong capitalization, innovative EV strategy, and advanced IT systems position it well for future growth, with a focus on BEVs.
• The company's valuation is attractive, trading below historical P/E averages, with a potential upside of 17-25% per year towards 2025-2027E.
• I maintain a “Buy” rating for BMW, with a revised price target of €100/share, highlighting its quality, safety, and realistic earnings growth potential.