The BMW share has plunged to its lowest in years, and the sell-off shows no sign of letting up. Since January the stock has lost more than 37% of its value, closing Friday at €60.38 — barely above the 52-week trough of €58.80 touched on June 18. Technical indicators now flash oversold: the relative strength index sits at 20.5, a level that historically has preceded bounces. Yet the fundamental picture remains deeply troubled.
The trigger came on June 16, when BMW slashed its full-year guidance. The EBIT margin in the automotive segment was cut to a range of just 1% to 3%, down from the previous 4% to 6%. The group’s pre-tax result is now expected to decline significantly, a sharp reversal from the earlier forecast of only a moderate drop. The profit warning sent the stock tumbling more than 10% in a matter of days, and the damage has continued to mount.
To cushion the fall, BMW has stepped up its share repurchase programme. In mid-June alone the company bought 423,000 ordinary shares via the Xetra platform for nearly €29 million. The buyback is part of a larger programme that runs until at least April 2027, and management maintains the 30%–40% payout ratio. Whether the purchases will prove sufficient to stabilise the share price remains an open question.
Should investors sell immediately? Or is it worth buying BMW?
Analysts are sharply divided on the outlook. JPMorgan’s Jose Asumendi calls the warning a wake-up call for the entire European auto sector, arguing that BMW must rethink its strategy in China’s compact segment, where premium makers can no longer compete on price. Goldman Sachs, however, sees the sell-off as overdone. Analyst Christian Frenes notes that the industrial net cash position now exceeds the entire market capitalisation of the group, and kept a buy rating while cutting the target from €107 to €84. UBS’s Patrick Hummel takes a more cautious stance, slashing his price target from €88 to €70 with a “Neutral” rating and lowering earnings-per-share estimates by as much as 44%. His model assumes no recovery in China. ODDO BHF also stays at “Neutral”, cutting its target from €75 to €60.
The causes of BMW’s misery are twofold. Demand in its key Chinese market is weakening at an accelerating pace, intensifying price competition. At the same time, the ongoing conflict in the Middle East is keeping energy costs high and weighing on consumer confidence. Both factors already dented the group’s second-quarter results and free cash flow.
Management is now rushing to adapt. Additional efficiency measures are being accelerated, which will trigger one-off costs in the second half of the year. In China, older electric models are being phased out to make room for local production of the “Neue Klasse” generation, a new platform that is not expected to bear fruit until the second half of 2026 at the earliest. Meanwhile, on June 18, BMW opened orders for the all-electric i3 First Edition — a product signal that could eventually lift spirits, but whose earnings impact remains a distant prospect.
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