Stellantis Drops After Morgan Stanley Downgrade

Stellantis shares fell more than 2% on Monday, 14 September 2026, after Morgan Stanley downgraded the automaker to Underweight from Equal Weight. The bank also lowered its price target on the stock to $5.20 from $8.00.

The rating action came in a broader European auto sector review by Morgan Stanley analysts led by Javier Martinez de Olcoz Cerdan. The team pointed to shifts in Stellantis' inventories and incentives, noting that its product pipeline lags behind rivals. The analysts said that lag could restrict the company from lowering investments while cash generation falls.

Morgan Stanley stated that Stellantis carries the widest risk and reward skew across the sector. The team highlighted debt refinancing as a potential risk, alongside possible asset sales and revisions to the United States-Mexico-Canada Agreement that could alter the outlook.

Across the European auto industry, the bank raised its 2026 and 2027 estimates for the first time since April 2024, placing its forecasts slightly above market consensus. In other rating moves, the bank upgraded Renault to Equal Weight from Underweight with a price target raised to €31 from €25. It kept Overweight ratings on Mercedes-Benz and BMW, lifting targets to €59 from €58 and to €76 from €74 respectively, while increasing Volkswagen's target to €89 from €77 and keeping Porsche at Underweight.