Mercedes-Benz Draws Bullish Analyst Calls on Hungary Cost Edge as China Headwinds and Technical Signals Diverge
Published on 07/16/2026 at 19:06 | Redaktion boerse-global.de
Mercedes-Benz finds itself at a crossroads: two major investment banks have reaffirmed buy ratings with ambitious price targets, yet the stock’s technical picture and persistent China weakness keep the shares trading near multi-year lows. Deutsche Bank set a 74-euro target — roughly 62% above current levels — while HSBC sees 47% upside with a 65-euro objective. The bullish calls rest heavily on the automaker’s structural cost advantages from its expanded Hungarian plant, even as near-term headwinds mount.
The share price closed at 46.20 euros on Wednesday, up 5.36% on the week but still 25.06% lower year-to-date. It has recovered 8.35% from the 52-week low of 42.64 euros hit in late June. By Thursday, the stock slipped to 45.72 euros, down 1.05%, leaving it 26.62% below the December 2025 high of 62.30 euros. The 50-day moving average of 47.65 euros now sits 4.06% above the current price, underscoring short-term weakness.
Hungary Plant Becomes a Cost-Leverage Engine
The centrepiece of the Deutsche Bank recommendation is the expanded factory in Kecskemét, now Hungary’s largest car plant. Mercedes officially inaugurated the enlarged facility on July 16, with management praising its cost benchmarks. The site recently started production of the new fully electric C-Class and will exclusively manufacture the compact G-Class going forward. Deutsche Bank analyst Tim Rokossa argues that the capacity shift to a lower-cost country will structurally improve the group’s cost base, providing a clear runway toward the 74-euro target.
HSBC’s 65-euro target echoes similar reasoning: the bank sees nearly 47% upside despite acknowledging the China drag. Bernstein Research was more cautious, maintaining a “Market-Perform” rating but raising its price target to 61 euros.
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Vans Outperform as Pkw Guidance Holds
While the passenger car division targets a 3–5% adjusted return on sales, the van segment is running well above expectations. Mercedes now guides for an adjusted return at the upper end of the 8–10% range. The industrial free cash flow is expected to stay positive, though seasonally below the first-quarter level. The full half-year results will be published in July, providing a clearer picture of whether van strength can compensate for the passenger car drag.
China Sales Plunge Fuels Structural Concern
The biggest drag on earnings remains China. Sales in the world’s largest auto market collapsed by around 30% in the second quarter, as the combustion-engine segment rapidly loses ground. A Handelsblatt commentary on July 16 noted that German automakers — including BMW and Volkswagen — are suffering similar declines, with managers increasingly open about the difficulty. The structural weakness in Mercedes’ most important export market is a burden that even the buy recommendations cannot ignore.
On the domestic front, the brand is losing market share despite an electric-vehicle boom. EY data for the second quarter of 2026 showed a record 208,400 EV registrations in Germany, up 54%, fueled by a government purchase subsidy. Mercedes posted a 122% jump in EV registrations, but German manufacturers overall saw their combined market share drop from 63.1% to 53.9%, while Tesla surged 305%. On the used-car market, Mercedes holds a 12.0% share, trailing Volkswagen’s 17.8%.
Job Cuts and Management Change Weigh on Sentiment
Mercedes announced roughly 5,500 job cuts as part of its half-year report, though the figure is more moderate than layoffs at other German automakers. The cuts feed into a broader narrative of cost restructuring that includes the Hungary expansion. Meanwhile, Group CIO Katrin Lehmann will leave the company on September 1 of her own accord; her IT transformation duties have been integrated into the “People & Enterprise Tech” board unit under Britta Seeger.
Bond Structure Shifts Without Investor Impact
On the financial side, Mercedes completed a structural change to its debt program on July 15. The Dutch subsidiary Mercedes-Benz International Finance B.V. became the new issuer for four bond series totaling 3.5 billion euros. The largest tranche, worth 1.5 billion euros, matures in 2029; two additional series of 750 million euros each run until 2030. The Mercedes-Benz Group AG remains an irrevocable guarantor, so no economic change for bondholders occurs. The company described the move as a clearer framework for its international financing.
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Technical Outlook Warns of Further Weakness
Counterbalancing the analyst optimism, a technical analysis from index-radar.de forecasts continued softness over the next four weeks, placing the stock in a range of 39 to 46 euros. That band implies potential downside of up to 15% from Thursday’s level. The gap between the bullish analyst view and the cautious chart signals leaves investors with a split narrative — one driven by long-term cost advantages, the other by short-term market realities.
All eyes now turn to the quarterly figures due on July 28, 2026. The numbers will test whether the van segment’s momentum and Hungary’s cost benefits can outweigh the China slump and a still-uncertain EV transition in the home market.
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