One-glance verdict
Undervalued
$174.19 our estimate vs market $45.95
Wall Street consensus: $59.10 (-66.1% lower than our fair-value estimate)
74% below our estimate, below the bear case
Fundamentals snapshot
Mercedes-Benz Group AG
MBGAF · PNK · Consumer Cyclical · Auto Manufacturers
Current price
$45.95
52-week range
$43.41 - $72.81
Market cap
$43.62B
Balance sheet
Watch
12.24x Strong cushion
Net debt $95.83B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
3 Risks
3 rewards · 3 risks
- Reward Returns 5.6% on equity, ahead of 60% of its peers.
- Reward Free cash flow was positive in 4/10 years.
- Risk Operating margin compressed from 11.9% to 6.2% over 3 years.
- Risk Net debt grew 4.6% over 3 years.
What this company does
Mercedes-Benz Group AG
Mercedes-Benz Group AG is a car company that makes and sells fancy cars and vans under brands like Mercedes-Benz and G-Class. Their money mostly comes from selling these vehicles, but also from financing and leasing them through their financial services arm, which is like offering loans and rental options for cars. This diversified income stream helps them stay stable even if car sales fluctuate.
How the company got here
Mercedes-Benz Group AG, formerly known as Daimler AG, has a history stretching back to 1886, making it one of the pioneers in the automotive industry. The company was founded by Karl Benz and Gottlieb Daimler, who independently invented the automobile. Over the decades, it grew through innovation and strategic acquisitions, becoming a globally recognized symbol of luxury and engineering excellence. A significant turning point was the separation of its truck and bus division (now Daimler Truck) in late 2021, allowing the company to focus purely on its premium and luxury car and van businesses, and subsequently rebranding to Mercedes-Benz Group AG in February 2022.
What it actually does
At its core, Mercedes-Benz Group AG designs, builds, and sells premium and luxury cars and vans. Think of the sleek sedans, powerful SUVs, and versatile vans you see on the road, often associated with high quality and advanced technology. They also sell the spare parts and accessories that keep these vehicles running and allow owners to customize them. The company aims to provide a complete automotive experience, from the initial purchase to ongoing ownership and even charging solutions for electric vehicles.
Mercedes-Benz Cars
This is the largest part of Mercedes-Benz Group AG, focusing on the development, manufacturing, and sale of passenger cars. It includes the iconic Mercedes-Benz brand, known for its luxury sedans and SUVs, as well as the high-performance Mercedes-AMG line and the ultra-luxury Mercedes-Maybach models. This segment is responsible for the majority of the company's revenue, catering to customers who prioritize comfort, performance, and prestige in their vehicles. They also offer models under the rugged G-Class brand.
Mercedes-Benz Vans
This segment is dedicated to the production and sale of light commercial vehicles, primarily vans. These vehicles serve a wide range of commercial purposes, from transporting goods and people to specialized applications like emergency services. While smaller than the cars division, it's a significant contributor to the company's overall business, offering practical and reliable solutions for businesses and tradespeople. This part of the company also includes related spare parts and accessories.
Mercedes-Benz Financial Services
This division provides a suite of financial and mobility services to support the sale and use of Mercedes-Benz vehicles. It offers financing options for purchasing cars and vans, leasing agreements for those who prefer not to own outright, and vehicle subscription services for flexible access. Additionally, it covers insurance, fleet management for business customers, and digital services, including those related to charging electric vehicles, making car ownership more convenient and accessible.
What management is betting on now
Mercedes-Benz Group AG is heavily focused on accelerating its transition towards an all-electric future and developing cutting-edge software for its vehicles. Management is investing significantly in electric vehicle (EV) technology and platforms to offer a wider range of battery-powered cars and vans. They are also prioritizing the development of proprietary vehicle software, aiming to enhance the driving experience and create new digital services. This strategic shift is crucial for staying competitive in the evolving automotive landscape and meeting increasingly stringent environmental regulations.
Price history
How the share price has moved
—
Loading price history…
Is it cheap or expensive?
Fair value $174.19 vs current price $45.95
Wall Street consensus is the average analyst price target: $59.10 (-66.1% lower than our fair-value estimate).
Our most-likely fair value is $174.19 a share — about 279.1% above today's price of $45.95, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Watch
Net debt $95.8B. Interest coverage 12.2x.
Net debt
$95.83B
Interest coverage
12.24x
Mercedes-Benz Group AG's profit covers its interest bill about 12.2 times over. which is stronger than most peers shown here.
Watch
Worse cushion
Baseline
Better cushion
MBGAF
BASELINE
Mercedes-Benz Group AG
Total debt $114.33B Interest coverage 12.24x This is the baseline the peer rows are being compared against.
Total debt $16.08B Interest coverage 14.35x +17% vs MBGAF Carries about 1.2x more debt cushion than MBGAF.
Total debt $128.77B Interest coverage 4.00x -67% vs MBGAF Carries about 3.1x less debt cushion than MBGAF.
Total debt $314.14B Interest coverage 3.33x -73% vs MBGAF Carries about 3.7x less debt cushion than MBGAF.
Total debt $3.54B Interest coverage 50.94x +316% vs MBGAF Carries about 4.2x more debt cushion than MBGAF.
What you should know
The case for and against MBGAF
3 Rewards
3 Risks
Rewards
-
Returns 5.6% on equity, ahead of 60% of its peers.
-
Free cash flow was positive in 4/10 years.
-
Trades at 7.5x P/E vs peer median 37.3x (80.0% cheaper).
Risks
-
Operating margin compressed from 11.9% to 6.2% over 3 years.
-
Net debt grew 4.6% over 3 years.
-
Stock trades 4.5% above its 5-year average P/E.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
7.46x
Forward P/E
6.01x
P/B
0.41x
P/S
0.34x
EV/EBITDA
10.76x
PEG ratio
0.59x
Profitability
How much profit each dollar creates
Gross margin
16.2%
Operating margin
6.2%
Net margin
3.9%
ROE
5.6%
ROA
1.9%
Health
Liquidity and balance-sheet strength
Debt / equity
1.10x
Current ratio
1.32x
Quick ratio
0.77x
Total debt
$114.33B
Total cash
$18.50B
Growth
How the business has been compounding
Revenue TTM
$144.82B
Revenue 5Y CAGR
-4.1%
EPS TTM
6.16
EPS 5Y CAGR
-26.7%
Cash flow
How much cash the business throws off
Operating CF TTM
$20.14B
Free CF TTM
$9.24B
FCF margin
6.4%
Dividend
Shareholder payout
Yield
9.0%
Payout ratio
66.3%
Last ex-div date
2026-04-17