BMW shares rise sharply supported by Q3 results

BMW shares rise sharply supported by Q3 results
Written by:
Stanko Iliev
14th November, 21:21
Updated: 14th November, 21:22
  • BMW has launched the iX, a full-electric car that will be the automaker's new technology flagship
  • Total revenue declined only 1.5% Y/Y in Q3, mainly due to COVID-19 impacts and GAAP EPS was $3.2
  • Analysts are „bullish“ on BMW and this stock could be a good "buy" opportunity

BMW (OTC: BMWYY) stock has advanced from $22.4 to $28 in less than three weeks and the current price stands around $27.9. Shares of BMW could be a good investment option and most financial analysts are also expecting its price to rise considerably in the next several years.

Fundamental analysis: BMW has launched the iX that will be the automaker’s new technology flagship

Bayerische Motoren Werke AG, also known as BMW, is a German multinational company that produces vehicles and motorcycles. The company is attracting investors’ attention in this uncertainty on the financial markets because it performs much better than its competitors.

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When trading BMW stock, investors should have in mind that this is a stable company with a good position on the market. BMW has released Q3 earnings results, total revenue declined only 1.5% Y/Y, mainly due to COVID-19 impacts and Q3 GAAP EPS was $3.2.

Fundamentals of the company have improved in the third quarter after having briefly deteriorated during the second one.

According to the latest news, BMW has launched the iX, a full-electric car that will be the automaker’s new technology flagship. The 500-hp SUV is powered by two electric motors that drive all four wheels and according to analysts, this electric car will compete with Tesla.

It is also important to mention that BMW and Alibaba signed a strategic partnership in Beijing to leverage their own resources. Jochen Goller, President and CEO of BMW Group Region China, said, “Cross-industry collaboration and open innovation exchange are indispensable in accelerating the ongoing digital transformation of our company”.

Shares of BMW could be a good investment option and most financial analysts are also expecting its price to rise considerably in the next several years. If we compare total stockholders’ equity of $70.7B and the market capitalization of $54B, we can notice that this stock is not overvalued and maybe now could be a good time to invest in BMW stock.

Another useful information for potential investors is that this company has paid more than $8B dividends to its shareholders in the last three years and this number can be even bigger in the future. Some estimates say that the auto market is expected to grow only slightly in the next several years but BMW will be one of the major players.

Technical analysis: Bulls are in control of the price action

Data source: tradingview.com

As long the price is above this trend line this stock is in the “buy” zone and there is no indication of the trend reversal. If the price falls on the trend line and if we get a “bullish” confirmation candle it would be a very good entry point for short-term traders who are trading with “stop-loss” and “take profit” orders.

The trend line represents a very strong support level, if the price breaks this trend line it would be a very strong “sell” signal and we have an open way to $20. If the price jumps above $28 it would be a signal to buy BMW stock and we have the open way to $29.

Rising above $30 supports the continuation of the bullish trend and the next price target could be located around $35.

Summary

Shares of BMW could be a good investment option and most financial analysts are also expecting its price to rise considerably in the next several years. BMW has released Q3 earnings results, total revenue declined only 1.5% Y/Y, mainly due to COVID-19 impacts and Q3 GAAP EPS was $3.2. Fundamentals of the company have improved in the third quarter after having briefly deteriorated during the second one.

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