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Bloomberg
Aston Martin fell the most since its controversial initial public offering (IPO) last year as the luxury carmaker said some UK and European buyers are delaying purchases amid uncertainty around Brexit.
The stock dropped as much as 18 percent and was trading 17 percent lower at 1,138.6 pence in London. That’s less than two-thirds of the 19-pound price at which the Gaydon, England-based company sold shares.
Aston Martin is struggling to gain traction with investors after an IPO that valued its stock on a par with Italian supercar leader Ferrari NV, which in turn trades at multiples more in line with those of luxury goods companies than other automakers.
Chief Executive Officer Andy Palmer says October’s valuation was justified by plans to double output to 14,000 vehicles by 2023, yet the company won’t be able to significantly lift production until a new plant begins deliveries of the DBX SUV model next year. Adding to concerns that the IPO was overpriced are misgivings linked to Brexit, trade tensions and slowing global auto markets.
While 30 million pounds ($40 million) of working capital set aside to deal with the worst outcomes from leaving European Union may not be needed as Prime Minister Theresa May moves toward ruling out a no deal split, warnings from Palmer about would-be buyers putting off purchases represent a new risk.