Porsche plans blockbuster IPO in the coming weeks

bj33813

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https://www.cnn.com/2022/09/06/investing/porsche-ipo-volkswagen/in

The iconic Porsche brand is officially going public despite stomach-churning stock market turbulence that's frozen out other big deals.
Volkswagen (VLKAF) first started looking at spinning off the high-performance automaker in February, just as Russia's invasion of Ukraine jolted investors.
In a statement late on Monday, Volkswagen said it had decided to press ahead with the initial public offering later this month or in early October, "subject to further capital market developments."
Up to 12.5% of Porsche will be offered to investors in the form of preference shares, with nearly half of the proceeds "of a successful IPO" to be distributed to Volkswagen shareholders in the form of a special dividend, the company added.

Volkswagen has also said it plans to use the proceeds from the IPO to bolster its efforts to build more electric vehicles. The company intends to dole out €89 billion ($88.4 billion) over the next five years on developing EVs, about half of its planned spending in that time. It wants EVs to represent a quarter of sales by the end of 2026.

Reuters has reported the initial public offering could value Porsche as high as €85 billion ($84.4 billion), and that Volkswagen could raise more than €10.5 billion ($10.4 billion). That would set it up to be one of Europe's biggest IPOs ever, according to data from Dealogic.
The blockbuster listing will go ahead even as recession fears, soaring energy prices in Europe and uncertainty about plans by central banks to slow inflation roil markets. That's slowed most dealmaking to a crawl, as companies wait for more certainty before pursuing mergers or public offerings.

A leadership shakeup at Volkswagen has added to uncertainty over the listing. Oliver Blume took the reins as chief executive of the German auto giant this month after Herbert Diess was ousted from the job in July.

 

Loltheinternet

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Hopefully they also use the funds to bolster the production of electric vehicle charging stations.
 

TaycanHero

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Gentlemen, short the IPO and technically you'll receive a large discount on your Taycan.
 

TaycanHero

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p.s. JP Morgan are moving some company services out of Germany and into the UK, over fears there will be major energy outages.

That's for financial services which only require servers, IT and comms equipment.

For an energy intensive manufacturer like Porsche, it means production shuts down for some time...
 


DCYL725

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p.s. JP Morgan are moving some company services out of Germany and into the UK, over fears there will be major energy outages.

That's for financial services which only require servers, IT and comms equipment.

For an energy intensive manufacturer like Porsche, it means production shuts down for some time...
That's a pretty good thesis for a short at first glance.

Let's take a deeper dive into the financials and implied valuations.

They did 30bn euros in 2021, 85bn USD IPO, quick math 1:1 forex that is 2.8x Price to sales.

Auto & Truck, 26 firms, trade at 4.22x PS with a 3.96% Net margin. Probably no growth/ or single-digit/decline.

Retail Car industry trades <1x PSR.

Ferrari trades at 10x PSR but with 20% net margin, steady state. (this is very high for a car company)

Depending on what Porsche's margins look like, that 3x PSR looks fairly cheap for a premium car brand. The operating margin in 2021 was 16.5% up from 15.4% 3x PSR looks low for that kind of op margin. After-tax that is about 13.5%ish based on 21% corporate tax rate.

(https://europe.autonews.com/automakers/porsches-strong-2021-operating-margin-bolsters-ipo-plans)

https://www.autoblog.com/2022/07/18/porsche-ipo-profit-sales-plans/

"Porsche targets an automotive Ebitda margin of as much as 27% by 2026, up from 24.5% last year, the company said Monday during its capital markets day. That would be below what Ferrari NV generated in 2021, but well ahead of Tesla Inc. and BMW AG.

On growth:
"Porsche is targeting revenue of as much as 39 billion euros this year and return on sales of as much as 18%, up two points from last year, according to Chief Financial Officer Lutz Meschke. Returns are to climb above 20% in the long term. 2021 30bn, 2022 39 bn( again this may miss) that's a 25% growth, amazingly fast.

That's a tough guidance to meet on back of production delays but that growth is very good for a legacy car brand. They can easily give a backlog, on-reserve sales number to mitigate visibility issues.

3x on Sales looks fair to me, actually undervalued if margin expansion continues towards Ferrari range and that growth is met. The energy outages are transient, so it'll create a one-off low-base on production numbers but doesn't change the key metric, demand. This can trade >5x Sales, quick estimate

Not much downside from this back-of-the-envelope analysis, but who knows what this volatile market will do.

Industry multiples
https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/psdata.html

Discloure, this is not investment advice.
 
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LXSC

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Genau

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I BOUGHT ! Hopefully this will be the next Tesla! poised to cash in after 1000%

Also took delivery of the Tycan GTS. From Porsche of Monterey CA.
Great car to Drive.
Hope you at least have fun with your stock purchase. Here's why I'm not holding my breath:
https://www.wsj.com/articles/volksw...b91uthn6g34&reflink=desktopwebshare_permalink
Volkswagen’s Porsche IPO Won’t Put Investors First
A deal to give luxury-car brand its own stock-market listing would be more about raising money for VW’s electric-vehicle push
 
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Dee

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It's not available in the Netherlands.
I already had Porsche SE (which owns Volkswagen AG, Porsche AG, Bugatti, Audi, Lamborghini, Scania, Skoda, etc).
It seems we'll see bottom soon.
Porsche IPO could be a good timing... we'll see.

Screenshot_20220924-081932.png
 
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B61

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I BOUGHT ! Hopefully this will be the next Tesla! poised to cash in after 1000%
IMO, not possible (maybe in a hundred years).
Please, don’t get me wrong, but I don’t see any (serious) reasons how could that happen.
 

Dee

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POAHY is the symbol
I BOUGHT ! Hopefully this will be the next Tesla! poised to cash in after 1000%

Also took delivery of the Tycan GTS. From Porsche of Monterey CA.
Great car to Drive.
No, you didn't.
You bought Porsche SE. 😂😂😂
Porsche AG is different and isn't out yet hence the IPO.
Screenshot_20220924-095409.png
 

tigerbalm

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POAHY is the symbol
I BOUGHT ! Hopefully this will be the next Tesla! poised to cash in after 1000%
You do know this stock is the holding company of the Porsche family that holds stock in VW, INRIX, etc. Not the operating company/manufacturer Porsche AG that is IPOing on the Sept 29?

Screenshot 2022-09-24 at 11.43.26.png
 

 
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