Aston Martin Price Target Raised Despite HSBC Seeing Further Downside

Aston Martin shares (LON: AML) are navigating a choppy landscape, as evidenced by a 40% decline in its share price over the past year. Despite a marginal increase in HSBC's price target, the overall sentiment surrounding the luxury automaker remains cautious, fueling concerns about its financial stability and future prospects.

Shares in Aston Martin are currently trading around 62.96p, a level that remains significantly below its peak valuation. HSBC recently raised its price target on the stock to 58 GBp from 56 GBp, yet maintained a ‘Hold' rating. This modest increase suggests a limited upside potential, reinforcing existing concerns about the company's ability to achieve profitable and sustainable growth.

HSBC's analysis suggests that 2026 may offer a more predictable environment for carmakers, yet the firm's conservative stance reflects ongoing concerns about Aston Martin's financial health and market position.

Goldman Sachs initiated coverage of Aston Martin with a ‘Neutral' rating and a price target of 61 GBp. The firm acknowledged Aston Martin's strong brand association with luxury but highlighted challenges in achieving profitable and sustainable growth in the ultra-luxury segment since its IPO. The firm also pointed out structural issues, particularly the company's capital structure, where net debt significantly outweighs equity, leading to high ratios of cash R&D spend and interest payments relative to sales.

JP Morgan reiterated a ‘Neutral' recommendation for Aston Martin, with a price target of 58 GBp, suggesting a potential downside from the current share price. This reflects ongoing concerns about the company's financial performance and market challenges.

Price Targets

Aston Martin's financial performance has been impacted by several factors, including weaker-than-expected demand in North America and the Asia-Pacific region. In response to these challenges, Aston Martin announced a reduction of approximately 5% of its global workforce, aiming to generate annual savings of about £25 million.

This move underscores the company's efforts to stabilize its finances amid a challenging macroeconomic environment, characterized by supply chain disruptions and weakening demand in key markets, including China.

Market Headwinds

The introduction of US tariffs has added complexity to Aston Martin's operations. The company flagged uncertainty stemming from new U.S. tariff policy and a quota mechanism tied to the U.S.-U.K. agreement, which limits duties on 100,000 British-made cars a year to 10%. This quota mechanism has made forecasting more difficult and has contributed to a reduction in the company's volume outlook for 2025.