In a note on French automotive suppliers, Stifel downgrades its recommendations on Valeo and Forvia from 'buy' to 'hold', with price targets reduced from 22 to 11.3 euros and 24 to 12 euros respectively.

According to the broker, current challenges (in addition to the tumult linked to the French legislative elections) could lead to a resetting of targets and prevent any recovery in the two shares, despite their underperformance since the beginning of the year.

Stifel reduces its EPS estimates for 2024-25 by 24% for Valeo and 13% for Forvia, and applies a larger discount to historical multiples. Only signs of sustained acceleration in sales growth could help these stocks to recover", he believes.

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