TLDR
- Stellantis stock fell 5.7% to $5.12, hitting decade lows and is down over 50% year-to-date in 2026.
- A recall of 955,000 vehicles worldwide over a radio software bug blocking rear-view cameras added fresh pressure.
- European operations posted an operating loss in Q2, with tight total profit margins of just 1.8%.
- Barron’s has pulled its turnaround recommendation after STLA dropped 29% since February.
- Wall Street has a Hold consensus on STLA with an average price target of $6.88, implying 34% upside.
Stellantis stock hit decade lows on Wednesday, falling 5.7% to $5.12. The stock is now down more than 50% in 2026, one of the worst performers among major automakers this year.
The latest drop came after Stellantis recalled roughly 955,000 vehicles worldwide, including 848,000 in the U.S. The recall covers a radio software bug that disables rear-view cameras on key models including Jeep. Stellantis confirmed an over-the-air update resolves the issue, and no injuries have been reported.
The recall knocked around 6.2% off the stock in mid-August and added to a long list of headaches for the company.
Earnings Paint a Tough Picture
In its Q2 report on July 30, net sales rose 13% year-over-year to €43.5 billion, with North America jumping 32%. That sounds good on paper. But total profit margins came in at just 1.8%, and European operations posted an operating loss.
Low-cost Chinese EV brands and fierce local competition have squeezed pricing power in Europe. That pressure is not unique to Stellantis. Mercedes-Benz and BMW have flagged similar issues. But for a company already fighting to recover, it makes the road back harder.
Free cash flow did come in positive at €1.0 billion for Q2, a small bright spot. U.S. sales of the Ram 1500 held up, showing some core strength in higher-priced vehicles.
Stellantis lost around $1 billion in 2025 after operating profit collapsed from roughly $25 billion in the post-merger boom years to under $10 billion in 2024. That collapse was tied to dealers taking on too much inventory, forcing a painful correction in sales volumes. CEO Carlos Tavares, a key architect of the Fiat Chrysler and Peugeot merger, lost his job over it.
Barron’s Pulls the Plug
Barron’s, which recommended STLA as a turnaround play in February when the stock was at $7.62, officially pulled that call this week. The stock had already fallen 24% on February 6 after a $26 billion asset write-down and dividend suspension. Since the recommendation, STLA is down 29%.
New CEO Antonio Filosa laid out a turnaround plan in May targeting €190 billion in sales by 2030 and a 7% operating profit margin. Free cash flow is expected to return in 2027. The plan was met with little enthusiasm, with the stock sitting near $7.50 at the time and now trading well below that.
The stock trades at under 5 times estimated 2027 earnings. General Motors trades at about 5.7 times. Cheap, yes. But analysts warn those earnings estimates may already be too optimistic given ongoing pressure from Chinese imports.
Wall Street currently rates STLA a Hold, based on two Buys, 10 Holds, and three Sells over the past three months. The average 12-month price target is $6.88, which would represent about 34% upside from current levels.
Morningstar places its fair value estimate well above the current price, and upgrades from AlphaValue/Baader Europe suggest some analysts see medium-term value at these levels.
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