The latest Market Talks covering the Auto and Transport sector. Published exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.

0917 GMT - Stellantis results in the second half of 2024 will probably disappoint investors given generous U.S. dealer incentives, deep cuts to North American inventories and the delay of some model launches, Citi says. The company has guided to a full-year adjusted operating margin of between 5.5% and 7%, and Citi expects the figure may land closer to the low end of the range at 6.2%. The bank believes Stellantis is better positioned going into 2025, but says the company is facing an even lower adjusted operating margin run-rate heading into the first half. "We remain cautious," analysts Harald C Hendrikse and Soumava Banerjee say. Citi rates Stellantis at neutral with a 13 euro target price. Shares rise 3.1% to 12.58 euros. (dominic.chopping@wsj.com)

0120 GMT - The earnings outlook for Malaysia's offshore service vessel segment appears neutral, as the daily charter rate supercycle may be nearing its peak, Maybank IB analyst Jeremie Yap says in a note. While tight vessel supply keeps rates elevated, uncertainty over rate growth and potential lower Petronas capital expenditure in 2025 could dampen investor interest, he notes. He highlights concerns over the aging offshore service vessel fleet, with 80% of vessels expected to surpass 12 years by 2025. Maybank favors defensive midstream assets and floating production storage and offloading players in the Malaysian oil-and-gas sector, with Dialog Group and Bumi Armada pegged as its top buys. (yingxian.wong@wsj.com)

2228 GMT - Jefferies assesses what President-elect Trump's tariff threat means for car dealerships and the auto aftermarket, and concludes that it's not good news. Tariffs could lead to significantly higher retail pricing of vehicles and parts coming from China, analyst John Campbell says. That would hurt underlying demand. And given that consumer confidence remains fragile globally, car dealers and aftermarket suppliers may struggle to pass on cost inflation to customers, Jefferies says. That could squeeze their profit margins. "Whilst we feel some of this may be posturing on the part of the President, it remains a risk to both sectors," Jefferies says. It has an underperform call on ARB, and hold calls on Bapcor, Eagers Automotive and Peter Warren Automotive.(david.winning@wsj.com; @dwinningWSJ)

1849 GMT - A Transportation Department lawsuit against Southwest over late flights rattled some investors -- but analysts at TD don't see it going far. With a new administration taking over in a matter of days, TD's Tom Fitzgerald and Helane Becker foresee a friendlier rapport between the airline industry and its regulators. They aren't expecting the new transport chief to pick up where President Biden's DOT left off, and so yesterday's threat may not be very much of a threat at all. Still, shares of the airline are slipping, with the stock down 3% and almost 6% this month. (owen.tucker-smith@wsj.com)

1305 GMT - Ferrari EPS growth may slow somewhat in 2025, ahead of the new F80 car launch in the fourth quarter which will drive 2026 mix, Citi analysts write. Car sales growth slowed in 2024 as Ferrari tried to maintain its luxury status and restricted deliveries, despite its backlog, Citi says. Revenue growth was instead driven by improved mix as Ferrari increased deliveries of limited edition Icona models and special series, while prices of new models also rose. EBIT margins should be up around 100 basis points in 2024 and Citi expects 2024 EBIT rose 14% with EPS up 19%. Citi rates Ferrari at sell with a 360 euro target price. Shares rise 1.5% to 424.70 euros. (dominic.chopping@wsj.com)

1201 GMT - Overcapacity at several European and North American car factories has been a challenge for years, and many of these sites will probably now be closed or sold to other automakers, research firm Gartner says. The domino effect could lead to the closure of supplier factories, which will redefine the car manufacturing map of the U.S. and Europe, making low-cost countries the major hubs in production and supply chain, Gartner adds. Import tariffs on Chinese electric vehicles imposed by the U.S. and EU could see Chinese automakers set up factories in Europe and the U.S. or in free-trade partners like Morocco or Turkey, the research firm says. (dominic.chopping@wsj.com)

1109 GMT - Fraport's 2024 traffic in Frankfurt ended on a slightly soft note after passenger numbers declined for the month of December, Jefferies analysts say in a research note. Passenger traffic at Frankfurt Airport declined 1.1% on year last month to roughly 4.5 million travelers. "This was mainly driven by weakness across Western and Northern Europe," the analysts say. They add that the result meant year-end passenger growth at the airport of 3.7%, 8 basis points below consensus. Shares trade 2.8% lower at 54.45 euros. (pierre.bertrand@wsj.com)

1056 GMT - Aeroports de Paris' traffic rose 5% in December, and increased compared with November 2024, Jefferies analysts say in a research note. The increase was primarily driven by traffic growth at Paris' Charles de Gaulle Airport, the analysts write. Meanwhile, traffic from Asia was relatively stable last month at 92% of 2019 levels, compared with nearly 94% in November, Jefferies says. Other ADP airport groups GMR and TAV performed strongly last month, with traffic growth of 8.5% and 9.9% respectively, the analysts say. In 2024, the group's Paris airport traffic rose 3.7%, in line with guidance and 10 basis points ahead of Jefferies' estimate. Shares trade 0.3 lower at 106.90 euros. (pierre.bertrand@wsj.com)

(END) Dow Jones Newswires

January 17, 2025 04:20 ET (09:20 GMT)

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