FAIR VALUE REPORT
STELLANTIS · STLA · OCT 30, 2026 · AFTER RESULTS OF OCT 28, 2026
The model says Stellantis is worth $10. Not one bank on Wall Street agrees
The stock jumped 13% on a quarter that burned €4.0 billion of cash. A $10.06 fair value and a $9.00 top target both rest on the balance sheet, not the profits - and the quarter to December has to deliver cash for either to hold.
FPI VERDICT · OCT 30, 2026
DCF 50% · RELATIVE 30% · CONSENSUS 20%
113.8%
below fair value
UNCERTAINTY
VERY HIGH ±50%
FAIR VALUE BAND
$5.03 – $15.09
PRICE VS BAND
BELOW THE BAND
Numbers as of publication. Today's fair value and price: STLA stock page → · How uncertainty is rated →
4 MIN READ
THE REPORT IN 3 POINTS
- 01Stellantis burned 4.0 billion euros of industrial free cash flow in the quarter to September 2026 and lost 453 million euros.
- 02At $4.71 the stock trades at 0.2x book, and FPI's $10.06 fair value tops Wall Street's highest target of $9.00.
- 03To meet 2026 guidance, the December quarter must deliver over +0.4 billion euros of industrial free cash flow.
A 13% jump on a quarter that burned €4.0 billion
Stellantis ($STLA) closed the quarter to September 2026 with net revenues of €37.6 billion, up 1% from €37.2 billion in the same quarter of 2025. Adjusted operating income was €256 million, a margin of 0.7% against 0.2% in the quarter to September 2025. The net loss was €453 million and adjusted EPS came in at -€0.01 against a $0.25 estimate. Industrial free cash flow - the cash the carmaking business keeps after capital spending, the number that decides whether the balance sheet gets stronger or weaker - was -€4.0 billion in the quarter and -€4.9 billion for the nine months to 2026-09-30.
The two biggest regions traded places. North America went from a €475 million loss to a €64 million profit (0.4% margin) on 357,000 shipments, down 12% because of planned production shutdowns. Enlarged Europe went the other way: from a €157 million profit to a €311 million loss, a -2.2% margin, on 10% more shipments and lower prices. More cars sold in Europe produced less money - the opposite of a turnaround.
The stock went from a $3.92 low on 2026-10-23 to $4.71 on 2026-10-30 because the guidance survived, not because cash arrived. Management reaffirmed mid-single-digit revenue growth for 2026, a low-single-digit operating margin and industrial free cash flow better than in 2025. The market bought the promise; the quarter itself was the fifth earnings miss in eight reports.
| REPORTED | REVENUE | VS EST. | EPS | VS EST. | PRICE REACTION |
|---|---|---|---|---|---|
| OCT 28, 2026 | $49.7B | +5.8% | $-0.01 | −104.0% | +13.0% |
| JUL 30, 2026 | $49.7B | +1.5% | $0.14 | −48.1% | −2.5% |
| APR 30, 2026 | $44.1B | −0.6% | $0.25 | +66.7% | −5.5% |
| FEB 26, 2026 | $93.1B | +0.3% | $-0.70 | +73.8% | +4.9% |
| APR 30, 2025 | $74.4B | +1.2% | $-0.05 | −120.0% | −1.4% |
| OCT 31, 2024 | $85.0B | +95.9% | $1.91 | −20.4% | +3.6% |
| APR 30, 2024 | $91.2B | −10.6% | $2.47 | −0.8% | −9.8% |
| OCT 31, 2023 | $98.4B | −6.8% | $3.45 | +19.8% | +5.2% |
Stellantis beat the EPS estimate in 3 of the last 8 quarters. Price reaction is the move on the trading day after the results.
€61 billion of book equity for a $12 billion price tag: where $10.06 comes from
The FPI fair value is $10.06, 113.8% above the price. At $4.71 the stock trades at 0.2x book value and 0.1x sales, against an industry median of 0.5x sales and 12.8x earnings. Equity attributable to shareholders was €61.3 billion at 2026-09-30, up from €53.6 billion at 2025-12-31, while the market values the whole company at about $12 billion - roughly 20 cents for every euro of equity on the books. The relative-valuation leg of the model (30%) compares those multiples with peers, and a company priced at a fifth of its book inevitably lands far above its share price on that lens. The consensus leg (20%) pulls toward $6.43. How to value cyclical stocks explains why book value and trough margins, not current profits, anchor an automaker at the bottom of its cycle.
The DCF leg (50%) is the shaky one. A free cash flow yield of -133%, a return on equity of -43.1% and a net margin of -14.6% are the kind of inputs that make any discounted cash flow model for a loss-maker unstable: the result depends almost entirely on when the cash turns positive, and the only evidence for that is the 2027 target.
The book equity also needs a footnote. Of the €7.7 billion increase since December 2025, €4.9 billion came from hybrid perpetual notes issued in March 2026 - three tranches at coupons of 6.25%, 6.875% and 8.25% that accounting rules count as equity. That is rented equity costing roughly €340 million a year before a single share of common stock earns anything. Industrial net cash still fell to €5.4 billion from €6.7 billion despite that injection, and industrial liquidity dropped €3.1 billion to €42.7 billion.
Over the 120 days to October 30, 2026 the share price went from $5.82 to $4.63 (−20.4%) and the FPI fair value from $10.06 to $10.06 (0.0%). The gap moved from 72.9% below fair value to 117.0% below.
Street vs model: $10.06 is above every target on Wall Street
Consensus is hold: 0 strong buy, 7 buy, 9 hold, 0 sell. Price targets run from a low of $4.00 to a high of $9.00, with a median of $6.35 and a mean of $6.43 (2026-10-06). The FPI fair value sits 56% above the mean and 12% above the highest target - the $9.00 from Truist Financial, issued on 2026-05-22 when the stock was $7.63.
The direction since July has been one way:
- 2026-07-27: Piper Sandler to Underweight, target $4.00 (stock $5.69)
- 2026-08-03: UBS to Neutral; 2026-08-07: Bernstein to Underperform
- 2026-09-14: Morgan Stanley to Underweight, target $5.20 - down from $10.90 on 2026-02-03
- 2026-10-23: HSBC kept Reduce
- 2026-10-29, after the results: Jefferies cut its euro target to €8.00 from €9.50 and kept Buy
The gap has a simple explanation. Analysts price the next 12 months and see -€4.9 billion of cash through September, €1.0 billion of tariff costs for 2026 and a European margin going the wrong way. The model weighs €61.3 billion of equity against peer multiples and a consensus that is itself 36% above the price. Wall Street is pricing the earnings, the model the assets, and only a cash flow turn reconciles the two.
7 buy · 9 hold · 0 sell. FPI fair value sits 12% above the highest Street target, the share price is inside the range.
The quarter to December must deliver more than €0.4 billion of cash
Guidance requires 2026 industrial free cash flow to beat the -€4.5 billion of 2025. With -€4.9 billion booked through September, the quarter to December 2026 has to produce more than +€0.4 billion. The same quarter of 2025 delivered about +€2.8 billion, so seasonality is on the company's side, and €1.1 billion of the roughly €1.6 billion in cash payments for 2025 charges was already out of the door by September.
FaSTLAne 2030 promises positive industrial cash flow in 2027, €6 billion by 2030 and a 7% margin by 2030, from 1.7% in the nine months to September 2026. Signals that show which way the story is breaking:
- Enlarged Europe margin back above 0% (quarter to September 2026: -2.2%)
- Value Creation Program savings in the mid-hundreds of millions of euros in the quarter to December, about double the quarter to September
- Industrial net cash holding above €5.4 billion at 2026-12-31
- Price levels: 50-day average $4.80, 200-day average $6.60, consensus $6.43, fair value $10.06
Up scenario: positive cash in the quarter to December and a European margin turn move the stock toward the $6.43 consensus. Down scenario: a guidance cut at the next results on 2027-02-25 (EPS estimate $0.11) makes the hybrid coupon the market's focus, and 0.2x book becomes 0.15x, back near the $3.92 low. The FaSTLAne update in Modena on 2026-12-10 is the first date that can push the price either way.
TOP OF THE FPI FAIR VALUE BAND
- 01A December-quarter swing to more than plus EUR 0.4 billion of industrial free cash flow would validate guidance after minus EUR 4.9 billion through 2026-09-30.
- 02At 0.2x book, EUR 61.3 billion of shareholder equity at 2026-09-30 is priced at about $12 billion, so any re-rating toward the 0.5x sector sales median lifts the stock hard.
- 03Enlarged Europe turning its -2.2% margin positive and FaSTLAne 2030 reaching a 7% margin by 2030 from 1.7% would restore the earnings power the model assumes.
LOWEST WALL STREET TARGET
- 01North America shipments fell 12% to 357,000 and the quarter still produced a EUR 453 million net loss, with ROE at -43.1% and net margin at -14.6%.
- 02EUR 4.9 billion of the equity increase is hybrid perpetual notes issued in March 2026 at 6.25% to 8.25%, costing about EUR 340 million a year before common holders earn anything.
- 03Piper Sandler's $4.00 target of 2026-07-27 anchors a street that has downgraded five times since July, and the stock is 56.8% lower year to date.
FPI FAIR VALUE $10.06 · FPI fair value of $10.06 sits above every street target including the $9.00 high, closer to the $15.09 bull anchor than to $4.00, and only a positive December-quarter cash number decides which holds.
FPI fair value blends a discounted cash flow model (50%), relative valuation against sector peers (30%) and analyst consensus (20%), updated daily. How the model works →
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This is the first FPI fair value report on Stellantis. The next one follows the company's next quarterly results.
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