Billionaire Lawrence Stroll is not just speaking for himself, he's speaking for himself, and he thinks others should do the same with his latest endeavor.
Stroll, who has been Aston Martin's (AML.L) largest shareholder and chairman since 2020, believes there are better times ahead for the British luxury carmaker and its namesake Formula 1 race team.
“I think our shares are significantly undervalued,” the Canadian said at the Aston Martin Q Lounge in Manhattan earlier this week, insisting that Aston was his long-term investment.
“I don't intend to sell for a very long time. This 111-year-old iconic British institution currently produces the best product and range in the luxury performance automotive sector and I see it as the perfect fit with what will likely be the best Formula 1 team.”
Stroll and Aston Martin are forecasting positive cash flow again this year, but Aston shareholders have had a tough time this year, with the company's shares down more than 35% so far this year.
Stroll claims he thinks the company's underperformance is in the past, and warned investors that the start of 2024 is still a transitional period for the brand. Stroll said first-quarter deliveries were down 26% year-on-year because the company deliberately did not sell some older models to allow new products into showrooms, with vehicles such as the new Vantage sports car, DB12 grand tourer and refreshed DBX707 due to arrive soon.
“We're finally getting close to what I said four years ago. No one listened to me then, but I said it would take four years. We're at that four-year inflection point where we'll be cash flow positive.”
Last year wasn't easy – Aston had to raise capital multiple times and Saudi Arabia's PIF, China's Geely Automobile and Lucid joined as new shareholders – but Stroll, who made his billions in fashion and textiles, reiterated that he has no plans to add more partners at the moment.
Stroll believes Aston is set up for success because it has taken the time to develop the car with a new vehicle and improved engine, design and even in-house developed software. Stroll said there are about 400 to 500 pre-orders for the new Vantage, a $160,000 car.
Production of Aston's upcoming plug-in hybrid supercar, the Valhalla, is also ramping up, but its EV ambitions have been delayed, with the first EV now arriving in 2026 instead of 2025. Stroll said the EV delay was “simply down to a lack of customer demand,” but he was surprised to see demand for hybrids growing even at the luxury level. Beyond the Valhalla, Stroll said Aston's hybrid ambitions include another sports car and an SUV.
And then there's Formula 1. Stroll said the global racing series was a “huge success,” with 2.3 billion viewers tuning in to watch 24 races in locations including Singapore, Las Vegas and Monaco last weekend.
F1 holding company Liberty Media (FWONK) reported that first-quarter revenue jumped from $381 million to $553 million and operating profit nearly quadrupled from $35 million to $136 million.
Since relaunching the Aston Martin brand in F1 in 2021, there has been no looking back for either Aston or Stroll.
“F1 has been transformative for us, we've gained younger customers, we've gained customers who didn't even know what Aston Martin was,” Stroll said.
“The actual business of F1 is booming, particularly in this country, and Aston Martin’s business is booming because of F1. [and] For every new product we launch.”
Pras Subramanian is a reporter for Yahoo Finance. Follow him at twitter and Instagram.
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