Below 40p, Aston Martin’s shares are sinking fast. How low could they go?
Aston Martinâs (LSE:AML) share price is now (16 March) below 40p. Itâs astonishing that the British icon, which floated its stock at £19 in October 2018, has lost so much value.
However, could it recover? Or might the groupâs shares fall further still? Letâs see.
Could the end be nigh?
Some mistakenly believe that a falling share price is a sign of imminent bankruptcy. In reality, a share price is a judgement as to how much a companyâs worth. In simple terms, itâs an opinion, albeit one thatâs determined by thousands of interactions of buyers and sellers.
Even if Aston Martinâs market cap went to £0, it doesnât mean the group will go out of business. This will only happen if itâs unable to meet its day-to-day obligations to pay its staff and suppliers. And despite its recent troubles â looking back to 2015, itâs only reported one annual profit — thereâs no indication this is likely.
| Year | Cars sold | Revenue (£m) | Net profit/(loss) (£m) |
|---|---|---|---|
| 2015 | 3,615 | 510 | (107) |
| 2016 | 3,687 | 594 | (148) |
| 2017 | 5,098 | 876 | 77 |
| 2018 | 6,441 | 1,097 | (57) |
| 2019 | 5,862 | 981 | (118) |
| 2020 | 3,394 | 612 | (411) |
| 2021 | 6,178 | 1,095 | (189) |
| 2022 | 6,412 | 1,382 | (528) |
| 2023 | 6,620 | 1,633 | (227) |
| 2024 | 6,030 | 1,584 | (324) |
| 2025 | 5,448 | 1,258 | (493) |
A potential crunch point
But persistent losses have to be funded. The necessary cash to continue trading must come from debt, existing shareholders, or new investors. Almost inevitably, there comes a point when these stakeholders start to lose patience and refuse to stump up. At this point, a decision has to be made. Either a new buyer is found or the company in question will cease trading.
Personally, I canât see Aston Martin losing all support. Due to its prestigious brand, beautiful products, and rich motoring history, itâs the type of business that will always be wanted by someone.
And with a market cap of around £400m â not far off its accounting value of £329m (at 31 December 2025) — I suspect a number of potential buyers are eyeing up the opportunity to become involved.
Whenever a takeover bidâs announced, itâs often the case (no guarantees) that a potential buyer will have to pay more than the current market price to secure full ownership. But buying shares in the hope of a takeover isnât a great idea. After all, one might not materialise or it might come at a bargain basement price.
How much?
And a fundamental problem with Aston Martin is itâs difficult to know what itâs worth due to its losses. It needs to sell more cars. Cutting costs and operational efficiencies will help its bottom line to some extent, but a boost to its financial performance can only come about by persuading more people to buy its cars.
When the group floated in 2018, it said: âthe optimal volume is up to around 7,000 sports cars per year, with additional volumes from [sports utility vehicles] and sedans driving target volumes of around 14,000 cars per year in the medium termâ.
Unfortunately, the group only has sports cars in its current range. Based on its 2025 results, producing 7,000 of these (1,552 more than it did) would have reduced its losses by approximately £105m. But it wouldn’t have even been at break-even.
Personally, I love the brand and hope it can recover soon. But a combination of tariffs, sluggish economies in its key markets and the war in the Middle East, is making life difficult for the British legend. I fear Aston Martinâs share price has further to fall. On this basis, I donât want to own any of its shares.
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James Beard has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
