STELLANTIS, PURE ONE, AND VOLVO: THREE BETS ON THE FUTURE OF ZERO-EMISSION DRIVETRAINS

STELLANTIS: PRAGMATISM AFTER THE PRICE DROP

The used-car market speaks volumes: Electric compact vehicles like the Opel Corsa Electric were still piling up at dealerships at the turn of the year. Two-year-old vehicles with 15,000 km on the odometer and 99% battery health were being sold like hotcakes at half their former list price. Since the latest gasoline price shock, they have been in demand as rarely before. Supply has become limited; dealers report significantly shorter time on the lot, and the price decline has halted. The stock of Opel's parent company, Stellantis, however, tells a less encouraging story. Anyone who has been following the stock of the Dutch-French-Italian-American multi-brand conglomerate has seen its value decline by around 80% since its high of over EUR 27.00 in the spring of 2024. By comparison, used electric vehicles from the group's brands—Opel, Peugeot, Citroën, Fiat, and others—have proven to retain their value relatively well even during the worst of times.

The most recent downturn in Stellantis's stock was triggered in February by a profit warning, after which the group suspended its dividend and announced billions in write-downs related to its zero-emission powertrain operations. The share price subsequently slid from EUR 8.50 to below EUR 6.00. The headlines sounded like a farewell to electric mobility. In reality, however, Stellantis is not making a U-turn but is instead practicing damage control with the utmost pragmatism. The only things that have been abandoned are the rigid goal of positioning itself as an all-electric brand by 2030 and the unprofitable hydrogen program for vans such as the Opel Vivaro-e Hydrogen. Regardless, 29 new electric models are set to hit the market by the start of the next decade. Microcars like the new edition of the Citroën 2CV—better known as the "Duck"—will even be offered exclusively as electric vehicles. In the commercial vehicle segment, the "Pro One 2030" program is taking effect. Under the slogan "Electric at the price of diesel," the group is offering tradespeople's vehicles, such as the Opel e-Combo and the Peugeot E-Expert, at the same prices as their diesel counterparts—a direct challenge to the strongest argument against electric propulsion: higher purchase costs.

Stellantis will therefore not fall behind the times. However, at the current share price of EUR 5.53, two conditions must still be met before entering the market: a technical chart signal indicating a bottom has been formed and a clear statement from management that it will return to its previous dividend policy once the current lean period ends. In the past, Stellantis has delivered dividend yields well above 5%. According to analyst estimates, the price-to-earnings (P/E) ratio for the coming year stands at 4.1—a bargain, provided the forecasts pan out. The price-to-sales (P/S) ratio of 0.1 also indicates a valuation that has been severely beaten down.

VOLVO: THE INNOVATIVE HEAVYWEIGHT FROM SWEDEN

Where Stellantis's product range ends with vans like the Fiat Ducato, Volvo's core business begins: heavy-duty commercial vehicles for long-haul transport, construction sites, and urban logistics. Volvo? Do they not already belong to Geely? Not at all. The world's largest truck manufacturer is and remains a long-established Swedish company, listed on the Stockholm Stock Exchange and controlled by powerful Scandinavian industrial holding companies and pension funds. Although Geely took over the passenger vehicle business years ago and at one point also held a stake in the truck division, it sold off most of its remaining stake—worth USD 1.3 billion—on the open market in 2024, thereby ending any speculation about control. China risk? Not a chance.

In addition to trucks, the product portfolio includes buses, marine propulsion systems, industrial applications, excavators, and other construction machinery, as well as Renault Trucks, Rokbak, and the iconic US brand Mack. Like its competitor Daimler Truck, Volvo is pursuing a consistent dual strategy of battery and hydrogen—with the difference that the Swedish company has held a market share of nearly 40% for heavy-duty electric trucks in Europe. This year, the new Volvo FH Aero Electric will hit the roads. Thanks to expanded battery capacity, the vehicle can travel up to 700 km on a single charge—a real game-changer for long-haul electric trucking. Volvo is also at the forefront of autonomous driving. The first driverless trains are operating in Texas between Houston and Dallas—particularly relevant in a country facing an acute driver shortage.

The first-quarter results demonstrate the Group's margin resilience. Despite a 9% decline in revenue to SEK 110.8 billion—due to declining market volumes and the exit from unprofitable business areas—Volvo slightly increased its adjusted operating margin from 10.9% to 11.0%. On a comparable basis, revenue would have actually grown by 2% thanks to the strong service business. A dividend yield of just under 5% is expected for 2026, with the prospect of increases in subsequent years. At the current price of SEK 315 (EUR 28.70) for the B-share, which is more liquid in Germany, the market capitalization amounts to approximately SEK 650 billion. This puts the P/E ratio for 2027 at just under 13 and the P/S ratio above 1—both significantly higher than Daimler Truck's levels, suggesting a market-leader premium. The comparatively higher dividend yield should compensate for this.

PURE ONE: THE APPLE MODEL IN HEAVY-DUTY TRANSPORT

Investors who want to benefit from zero-emission heavy-duty transport without being saddled with the capital-intensive burden of a car manufacturer need to think outside the box. The Australian niche player Pure One pursues a radically different model. The small team focuses exclusively on software, development, design, sales, and customer service. The capital-intensive manufacturing of heavy-duty vehicles is fully outsourced to partners such as Wisdom Motor in China. This consistent asset-light model à la Apple eliminates the need for expensive manufacturing facilities and reduces inventory risk to nearly zero.

While Stellantis is throwing in the towel on hydrogen, Pure One is currently delivering the first hydrogen-powered 32-metric-ton concrete mixers as part of a prestigious reference order to Heidelberg Materials. For the mass market, the company is also betting on battery-electric trucks starting in September with its "Alpha Series." The first garbage trucks have already been delivered to JJ's Waste & Recycling. Pure One counters the main argument against electric trucks—hours of downtime at charging stations—with a sophisticated battery-swapping system that gets the vehicles back into service within five minutes. A competitive price of around AUD 200,000 net is expected to put logistics fleets in the black from day one.

Analysts at Trim Capital see a significant valuation gap here compared to other emerging cleantech companies. Once the transition from the testing phase to binding large-scale orders is successful, they consider a price target of AUD 0.557 to be realistic—about ten times the current price of AUD 0.055 to 0.06 (currently around EUR 0.035 on German exchanges). The low share price and the tiny market capitalization of only about AUD 20 million carry the typical risks associated with a micro-cap. However, the fundamental data are remarkable for a company at this stage of development. If the analysts' estimates are reasonably accurate, positive EBIT could be achieved as early as this year. Starting in 2028, the profit engine is expected to run at full speed. The expected earnings per share of AUD 0.049 at that time is nearly equal to the current share price.

Added to this is a balance sheet that is exceptionally solid for the industry and the company's size. Cash reserves of AUD 5.6 million are offset by an undrawn credit line of AUD 7.6 million—while competitors are groaning under the weight of debt. Another safety net, which the market currently values at zero, is provided by the spin-off of the natural gas subsidiary Eastern Gas, which plans to extract gas in highly productive Australian regions. The IPO on the Sydney Stock Exchange was massively oversubscribed in early 2026; Pure One continues to hold just under 70% of the new company. So while the company is working toward a zero-emission future, a fossil fuel wild card lies dormant on its balance sheet in a country heading toward a significant gas shortage starting in 2028.

THREE WORLDS, THREE VALUATION CLASSES

A look at the P/S ratio reveals the different risk profiles at a glance. Stellantis trades at a P/S ratio of 0.1, placing it in the realm of extreme undervaluation—reflecting both the group's deep-seated structural problems and investors' concerns about the turnaround roadmap. Volvo has a P/S ratio well above 1, which reflects the quality of its business model and dividend continuity but makes it more expensive to invest in. Based on 2027 estimates, Pure One stands at around 0.6. However, the P/S ratio could drop to a level comparable to Stellantis's by 2028, when the projected revenue surge to AUD 144.9 million materializes. That would no longer be penny-stock speculation, but rather deep-value potential backed by industrial substance.