Mercedes-Benz Investors Await Clarity After a Bruising Quarter

Mercedes-Benz shareholders approve €3.50 dividend as stock falls over 15% YTD. Analysts cut targets after a 49% net profit drop, with Q1 sales down 6% globally and 27% in China.

Mercedes-Benz Group AG shareholders approved a dividend of EUR 3.50 per share, a rare piece of good news for a stock that has lost more than 15% of its value since the start of the year. The payout, however, is overshadowed by a stark financial reality and mounting analyst skepticism ahead of the company's full quarterly report on April 29.

The luxury automaker's shares currently trade at EUR 52.15, a level that sits roughly six percent below its 200-day moving average. This year-to-date decline significantly outpaces the one-time drag from the recent ex-dividend date. The pressure stems from a dramatic 49% plunge in the group's annual net profit, which fell from EUR 10.4 billion to EUR 5.3 billion.

In response to these challenges, analysts are swiftly reassessing their positions. Goldman Sachs moved on April 16, trimming its price target from EUR 69 to EUR 66 while maintaining a "Buy" rating. Analyst Christian Frenes cited estimates adjusted ahead of the Q1 figures, with the new target comprising EUR 56 for the core business and EUR 10 for the stake in Daimler Truck. Bernstein Research affirmed a more cautious "Market-Perform" stance on April 14 with a EUR 61 target, with analyst Stephen Reitman expecting the adjusted return on sales to land at the lower end of the company's guided range.

The operational headwinds are particularly severe in China, a critical market where first-quarter sales collapsed by 27%. Globally, Mercedes-Benz's passenger car deliveries fell by six percent in Q1 2026. While the pure-electric vehicle segment provided a glimmer of hope with an 11% sales increase, it has not been enough to offset broader concerns. The competitive landscape is intensifying as Chinese manufacturers like BYD and Geely increase pressure, especially in the premium sector.

Further clouding the outlook is a structural price decline for electric vehicles. Data indicates that in the UK, EVs are expected to become cheaper on average than comparable combustion-engine cars for the first time in April 2026, a trend that threatens to squeeze margins for established premium brands.

Other brokerages express deeper pessimism. Kepler Cheuvreux cut its target to EUR 57, while ODDO BHF sees a fair value of just EUR 42. The stock's valuation multiples appear low—with a price-to-earnings ratio around 11 and a price-to-book ratio of 0.62—but cheap ratings alone are failing to attract buyers amid the profit uncertainty.

CEO Ola Källenius has defended the company's strategic direction, emphasizing massive investments running into the double-digit billions for its proprietary MB.OS operating system and automated driving technology. All eyes are now on the April 29 report, where investors seek concrete answers on margin development, particularly within the van business. Should the profitability forecast for the remainder of the year disappoint, the stock's 52-week low of EUR 48.45 could come back into view.