License to make a killing? James Bond’s favourite car, the marque automaker Aston Martin has finally announced details of its Initial Public Offering (IPO).
Eagerly-awaited trading of shares in the first British carmaker to go public since 1970’s has generated tremendous excitement. Most traders were hopeful that the IPO, first announced in late August, might launch sometime before the end of 2018.
It was, therefore, a very pleasant surprise for FTSE traders, to hear that Aston Martin announced in its IPO prospectus that conditional trading will commence on Wednesday, 3 October.
With less than 2 weeks remaining until the automaker becomes a public company, now is the best time to prepare your trading resources to take advantage of the upcoming market opportunity.
Whether Aston Martin shares crash following a disappointing IPO or soar above the proposed 1750-2250p pricing range, thanks to strong emotional attachment to the iconic luxury brand, you can benefit with the help of Accendo Markets brokers and its award-winning research team.
The following report answers key questions ahead of the company’s London debut, such as the IPO prices and dates, as well as reviewing the current state of Aston Martin and how you can trade the exciting new listing with Accendo Markets.
Aston Martin sees itself as a luxury company that deserves a premium valuation, similar to Hermès, LVMH and Ferrari. Much like its Italian rival, Aston Martin has expanded beyond cars into ancillary products, creating a brand that is as much about lifestyle and emotional impact as it is about driving.
Parallels with Ferrari’s October 2015 IPO spring to mind of investors considering how Aston Martin shares will behave following its floatation on the London Stock Exchange (LSE). The Italian carmaker’s public trading may have seen its shares close 3% higher on Day 1, but within six months shares had fallen by close to 50% after a 22% slump in supercar shipments in China. The shares have, however, more than tripled since, hitting record highs this summer.
Ferrari currently trades at a valuation of 36 times 2018 estimated profits. This compares to 7.3x for other European automakers, suggesting a premium luxury valuation for the prancing horse (Source: Bloomberg, 29 August 2018). Looking at 2017 profits, the FT suggests Ferrari trading at 22x earnings, contrasting with Aston’s proposed top-end valuation of 24x earnings.
Aston Martin is looking to achieve similar premium valuation multiples with is IPO. This is based on improving financial results, with the latest half-year report pointing to growing revenues thanks to strong demand from Asia, realigning the automaker away from reliance on its local UK market and insulating it from some of the Brexit uncertainty.
The strength of Aston Martin’s brand is without reproach and investors around the world will be salivating at the chance to own a part of James Bond’s glamorous lifestyle. Moreover, with many iconic British brands (Bentley, Rolls, Jaguar, Land Rover, Mini, etc) falling under foreign ownership, the prospect of being able to own a piece of British automotive legacy may prove difficult to resist.
If you are excited about an opportunity to take part in the Aston Martin IPO or trade the company’s shares when it goes public, get in touch with one of our brokers to discuss your options.