Ferrari (RACE) rival Aston Martin reported a profit for the first half of the year as it revs up to challenge the famed Italian firm on the stock market by seeking an initial public offering.
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The British company, famed for being the favorite carmaker of fictional secret agent James Bond, could be valued at around $6 billion if it goes ahead with its plan to list on the London Stock Exchange.
The move would see it become the first British-based automaker to be listed in London in many years, after famed U.K. brands, including Rolls-Royce, Bentley and Jaguar, were sold to foreign owners.
Rolls-Royce is now a subsidiary of Germany's BMW, Bentley is part of Volkswagen and Jaguar is owned by India's Tata Motors (TTM).
Aston Martin is controlled by London-based Investindustrial Advisors and Kuwaiti fund Investment Dar, neither of which will completely dissolve their stakes. Daimler AG plans to keep its 4.9% stake.
In 2007, Ford (F) sold its majority stake in Aston Martin for $848 million to a consortium that included racing mogul David Richards, American investment banker John Singer, Investment Dar and Adeem Investment. In 2012, Italian private equity fund Investindustrial signed a deal to buy 37.5% of Aston Martin.
Ferrari closed up 3.2% at 134.20 on the stock market today. Meanwhile, troubled Tesla (TSLA) fell 2.2%, General Motors (GM) dipped 0.5%, Ford lost 0.4% and Fiat Chrysler (FCAU) eased 0.6%.
Aston Martin Profits
On Wednesday, Aston Martin reported half-year adjusted pretax profits of $54 million as revenue rose 14% percent to $579 million due to strong demand for its DB11 coupe and Volante models.
For fiscal 2017, revenue jumped 48% to $1.14 billion, adjusted EBITDA more than doubled to $268 million, while pretax profit rose by a quarter of a billion pounds to $113 million, compared to a pretax loss of $211 million in 2016.
The improved performance was driven by the company's highest full-year sales volumes in nine years, principally due to accelerating demand in North America, the U.K. and China.
Its increasing popularity saw Brand Finance name Aston Martin the fastest growing brand in its 2018 Auto 100 table.
The IPO effort will be made up mainly of a secondary sell-down by existing shareholders, with a free float of at least 25%. Kuwaiti and Italian private equity groups will be the main sellers.
Film fans may be among those keen to snap up some of the firm's stock. The iconic Aston Martin DB5 driven by James Bond in 1964's classic "Goldfinger" has been voted the greatest movie car ever in numerous polls, including one published earlier this year by Hyundai. The vehicle was featured in another seven James Bond movies including 2015's "Spectre."
Ferrari Stock Hits Road Bumps
Aston Martin's move comes after Ferrari stock encountered some recent bumps in the road. Earlier this month shares plunged after its new CEO softened the company's stance on old profit targets.
Louis Camilleri said his predecessor Sergio Marchionne's financial targets for the company through 2022 are "aspirational."
The results from the company, best known for its luxury sports cars, were the first since Marchionne's death. He had been the CEO of both Ferrari and Fiat Chrysler and was famous for turning around the latter company.
Ferrari could also be left exposed to any escalations in President Trump's tariff spat with the European Union. Trump and European Commission President Jean-Claude Juncker last week said they would begin discussing ways to ease trade tensions and indicated they would not levy more tariffs on each other.
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The post James Bond Carmaker Aston Martin Gets Profit Boost Ahead Of IPO, Lifts Ferrari appeared first on Investor's Business Daily.
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