Automakers Reverse, UBS Goes Ahead: EMEA Earnings Week Ahead

(Bloomberg) — A moment of truth beckons for automakers Stellantis NV and Aston Martin Lagonda Global Holdings Plc, both of which cut their forecasts ahead of next week’s earnings reports.

Most read from Bloomberg

While much of Fiat and Peugeot owner Stellanti’s malaise lies in the US, where demand is weak and inventories are rising, Aston Martin’s problems lie in China, the source of a wider industry downturn.

Banking earnings continue with reports from UBS Group AG, BNP Paribas SA and Societe Generale SA. Eighteen months after UBS’s takeover of Credit Suisse, CEO Sergio Ermotti is beginning to think about what’s next for the Swiss giant.

German chemicals giant BASF SE, plagued by higher energy costs and a persistent recession in China, is preparing its agriculture unit for a possible IPO as it moves ahead with an overhaul.

Marginal pressure may weigh on BP Plc, Shell Plc and TotalEnergies SE. GSK Plc, Novartis AG, Royal Philips NV and Haleon Plc are also due.

Monday: Philips ( PHIA NA ) should show solid sales growth and margin expansion, overcoming tough year-over-year comparisons and subdued Chinese demand, according to Deutsche Bank. It is expected to confirm guidance, although this depends on a strong fourth quarter.

Tuesday: BP’s (BP/LN) buyback pace will be in focus after the company flagged weak trading in oil products in the third quarter and lower margins from crude processing. It also expects net debt to have risen. That, combined with a weaker macroeconomic outlook in 2025, points to quarterly repurchases of $1.25 billion to $1.5 billion, down from the current pace of $1.75 billion, according to Bloomberg Intelligence’s Will Hares.

BI expects Novartis (NOVN SW) to defy 2024 guidance — seen as conservative by some — given tough comparisons last year. With patents expiring for heart drug Entresto and blood disorder Promacta, the outlook for 2025 will move more to the fore. “It may prove difficult to show any significant growth next year,” Stifel analyst Eric Le Berrigaud said.

Wednesday: UBS’s ( UBSG SW ) investment banking earnings may show signs of a seasonal slowdown, boosted by U.S. election uncertainty halting business activity, although a rise in fees could still deliver year-over-year growth. Global wealth and asset management units likely benefited from volatility in equity markets, while flow trends in Asia will be a key gauge of business health after an acceleration in the previous quarter, BI’s Alison Williams said.

Aston Martin ( AML LN ) shares are still reeling from September’s profit warning, which has left the company in the bottom three of the FTSE 250 Index so far. Change is afoot under new CEO Adrian Hallmark, who can manage “a more consistent, flatter, customer order-driven sales and production trajectory,” analysts at Citi said. The company’s compliance with the 2025 guidelines is “ambitious”, Deutsche Bank said, adding that a strengthened range of models should support demand and pricing.
BASF’s ( BAS GY ) volume growth would need to exceed the 2.4% of the previous three months to harden confidence that profits have bottomed out, BI said. Cash flow remains a priority as capex is likely to remain high through 2026. Consensus sees adjusted Ebitda up 5.1%.
A strong uptick in sales of shingles vaccine Shingrix is key for GSK ( GSK LN ) after a second-quarter loss. Shingrix revenue likely rose 8.5% in the quarter, consensus estimates show. The RSV vaccine Arexvy is also in focus, with future sales dependent on the frequency of booster vaccinations, according to BI. New data on Thursday showed promise for a broader group of adults at risk of the respiratory disease.

Thursday: Stellantis ( STLA US ) has flagged a 36% drop in shipments in the key North American market in the third quarter. The ousting of chief financial officer Natalie Knight just 12 months into the job and other changes to the brand’s COO are unlikely to improve sentiment, BI said. The shake-up leaves a tough road ahead for CEO Carlos Tavares, whose contract runs until 2026.

Shell’s ( SHEL LN ) third quarter could turn out to be its weakest this year as it struggled with the lowest oil realizations in 2024, below $80 a barrel, BI said. While the company forecast continued strong growth from its natural gas and upstream businesses for the quarter, it expected to lose money on chemicals. Buybacks for the final quarter should hold at $3.5 billion, in line with guidance, BI said. CEO Wael Sawan has pledged to take a “reckless” approach to driving shareholder returns.
TotalEnergie’s ( TTE FP ) adjusted net profit likely fell more than 8% sequentially to $4.3 billion. Upstream revenues could be squeezed by falling liquids prices, while a decline in European refining margins is likely to weigh on downstream, according to BI. The company is still expected to maintain its repurchase pace of $2 billion per quarter.
Equity trading is expected to drive BNP Paribas’ ( BNP FP ) earnings for the third quarter, according to BI’s Uzair Kundi. Consensus points to nearly €900 million in revenue from operations, up 15.5% from a year ago, and more than €1 billion in income from interest income, currencies and commodities, up 5.1%. Société Générale ( GLE FP ) will need a boost from its French retail unit, although the consensus of 16% higher revenue from the business may be ambitious, Kundi said.
Haleon’s ( HLN LN ) results could trigger a “pause in the positive narrative,” Citi analysts said, pointing to worsening currency headwinds and organic sales growth skewed toward the fourth quarter. The purchase of Pfizer Inc. shares bolsters confidence that cuts to non-core businesses can help boost margins and reach guidance for sales growth in 2024, according to BI’s Diana Gomes.

Friday: No major gain to note

–With help from Tuhin Kar, Paula Doenecke, Valentine Baldassari, Laura Alviž, Jenny Che and Tiffany Tsoi.