Is Aston Martin Stock Crash a Buy Opportunity?

• Aston Martin’s share has seen soared bearish trend.
• Worries about the firm’s future projections remain.
• However, it still boasts strong demand for its goods.

Aston Martin (LON: AML) stock price extended downside tendencies amid concerns about the firm’s future. The shares dropped by over 4%, nearing its 129.64p record lows, which is approximately 96% beneath its ATH.

Aston Martin: No Love

The luxury vehicle market remained impressive regardless of downturns in global assets such as automobiles and stocks. Consequently, luxury car firms did relatively well this year. For instance, while Ferrari had its share dropping around 30% in 2022, companies such as Ford and General Motors performed much worse.

Meanwhile, Volkswagen Group plans to take Porsche public – a move that will see the company’s value beyond $70 billion. Aston Martin isn’t performing well amidst supply bottlenecks. Its shares have declined by over 75% in 2022.

Moreover, the share price remains approximately 96% beneath its ATH. Also, the firm’s F1 team has struggled, currently at the 9th spot out of 10 in the constructor championship.

Still, Aston martin enjoyed a steady demand. For instance, its Sports/GT case lost out. Also, DBX orders have surged over 40% YoY, with V12 Vintage completely sold out. Thus, Aston Martin does not have demand issues.

Instead, the primary issue remains the supply challenges and stiff economic conditions. The firm’s total volumes lost 8% during the year’s first half because of supply constraints. Consequently, the company’s loss before tax stood at 90M pounds.

Aston Martin partially solved the balance sheet problems by raising funds from its clients and attracting the Public Investment Fund from Saudi Arabia to boost investments. Thus, the company’s share price will rely on how Aston Martin handles the supply chain hurdles.

AML Price Prediction

The daily chart indicated that AML shares exhibited massive bearishness over the last few months. That decline had the stock falling to the 132.35p lows – hitting the 14 July low. The shares have plummeted beneath all MAs, whereas the RSI (Relative Strength Index) slid under the 50-neutral.

Thus, AML shares will likely keep plunging, targeting the 132.3 YTD low. A dip beneath this foothold will mean bears prevailing and opening the path for stock falls towards 120p.

Editorial credit: Rowan Patrick Photos / shutterstock.com