Shares of French carmaker Renault
The Paris-listed stock was last seen trading down 15.6%, notching a fresh 52-week low. It puts the company on track for its worst trading day since March 2020.
In a trading update published late Tuesday, Renault said it is targeting an operating margin of around 6.5% this year, down from a previous forecast of around or exceeding 7%.
The company is also aiming for a free cash-flow between 1 billion euros ($1.16 billion) and 1.5 billion euros, down from roughly or above 2 billion euros, previously.
Renault also announced the appointment of Duncan Minto as interim CEO, following Luca de Meo’s abrupt resignation last month after around five years at the helm of the company.
“Currently CFO of Renault Group, Duncan Minto will ensure the day-to-day management of the company alongside Jean-Dominique Senard, who will hold the position of Chairman of Renault s.a.s., the operating company of the Group, during this period,” Renault said in a statement.
Renault is poised to report its half-year results on July 31.
Analysts at Germany’s Deutsche Bank cut their target price to 47 euros, down from 55 euros, on news of Renault’s profit warning.
“While the new margin guide remains solid also relative to peers, we see the warning as an obvious additional hit on sentiment for shares,” analysts at Deutsche Bank said in a research note.
Analysts at JPMorgan, meanwhile, said Renault’s new management structure would face further challenges from muted demand in Europe, ongoing trade tensions and rising competition from Chinese manufacturers.
— CNBC’s Jordan Butts contributed to this report.
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