Shares in Aston Martin Lagonda (AML) fell nearly 11% in morning trading to 194p as the luxury sports car maker cut its full year volume outlook for its recently launched DB12 model.

The shares have halved since August but remain around 24% ahead year to date. 

Sports car maker Aston Martin Lagonda hits 15-month high

The luxury car maker reported a pre-tax operating loss of £117.6 million for the three months to 30 September compared to a £225.9 million loss in the same year ago period.

Aston Martin said the cut in the full year DB12 volume outlook was due to the delays ‘experienced with the DB12 ramp up during the third quarter.’

AJ Bell investment director Russ Mould said: ‘The company is seeing strong demand but, with losses coming in ahead of expectations, there is little reason for the market to give Aston Martin the benefit of the doubt for even the smallest misstep. For now, little credence is being given to a 2024 forecast for £2 billion in revenue and £500 million in adjusted earnings.

‘It is still sitting on a big pile of debt and continues the painful effort of deleveraging a strained balance sheet.

‘Undoubtedly, progress has been made in fixing some of the problems faced by the business, but it all feels a bit too little too late. With the shares trading at a tenth of the level at which they listed in 2018, the optimistic comparisons Aston Martin made for itself with Italian rival Ferrari look as fanciful as they ever did.’

CONTRASTING FORTUNES FOR LUXURY CARMAKERS

Rival Ferrari (RACE:NYSE) is due to announce its third quarter results on 2 November.

Back in August Ferrari raised its full-year revenue and core earnings forecast due to exceptional  second quarter results and ‘robust orders’.

Analysts at US data firm Morningstar have revised Ferrari’s full year sales forecast from €5.7 billion to €5.8 billion.

Ferrari’s shares have also gained on its rival up 40% year-to-date.

DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The author of this article (Sabuhi Gard) and the editor (Martin Gamble) own shares in AJ Bell.

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