Why I don't regret buying Aston Martin shares | Thank Frankel it's Friday

03rd November 2023
andrew_frankel_headshot.jpg Andrew Frankel

A long time ago I did something I’d never done before. I bought some shares in a car company. It was Aston Martin. I know. But my thinking was as flawless as it is indicative as to why I will never be a stock market tycoon. The brand is incredible, one of the most coveted in the entire world, not just among car companies. And then CEO Andy Palmer’s strategy seemed impeccable to me. Essentially is was to have a range of front-engine GTs for the traditionalists, an SUV for those who need a large family car and would rather it was called an Aston Martin more than anything else, a mid-engined supercar to elevate the brand still further by competing with Ferrari, and for it all to be garnished with some headline-grabbing, money-making specials like the Valkyrie. What could possibly go wrong?


Plenty as it turns out. The shares, overpriced from the start, fell off a cliff. Aston Martin had judged itself upon what it felt capable of achieving, the market on what it had already done, which needed to be more to support what was always a very punchy valuation of the business.


But I still have the shares and not just because they’re worth so little there’s no point selling them. I have them because I still believe the company has a bright future. And anyone thinking I’m writing this in the hope of nudging said share price upwards has wildly overestimated what little standing I have in this business and the paltry number of shares I own.

I’m not even deterred by results published on Wednesday that saw its share price fall from 220p to 183p before struggling back to just under 200p which is where it sits as I write this. This was largely on the back of supplier issues with the DB12 meaning deliveries have had to be pushed back and which, we are told, have now been resolved.

Despite all that’s gone on, despite the fact that the company is already on its second new CEO since Andy Palmer’s departure in 2020, I still believe in that vision. As, I should add, does Aston Martin. Look at the plan he laid out almost ten years ago now and Aston’s plans for the future and they are remarkably similar. Yes, his idea to relaunch Lagonda as an all-electric luxury car were kicked into the long grass even while he was there (a shame because there was briefly a massive opportunity to lead the field in this area) and the mid-engined cars are now all going to be limited editions, but the rest of the structure remains.


Just as important, it has the product excellence to back it up. The DB12 is an astonishing accomplished car while the F1 Edition of the Vantage showed what potential always lay under that skin. The DBX707 is the best luxury SUV of them all and if what I’m hearing about the DBS replacement (which I’ll bet my socks will be called Vanquish) is true, it will be a car of enormous potential. Before that, there will be a new Vantage and you only have to look at the leap the DB12 made from the DB11 to be pretty damn excited about that too.

I also believe in its leadership, at least while Lawrence Stroll remains chairman and Amedeo Felisa its CEO. Say what you like about Stroll, and plenty do, few would deny he understands the luxury market as well as anyone. And Felisa’s credentials both as an engineer and the man who did so much to turn Ferrari into the company it is today speak for themselves.

Of course, the historical problem for companies like Aston Martin is that they are dwarfed by the financial, technological and purchasing clout of key rivals like Rolls-Royce and Bentley which massive automotive parent companies own. But with 17 per cent of Aston now owned by Geely (which also owns Lotus, Volvo, Polestar and many, many others) and Mercedes upping its stake to 20 per cent this year, there is no shortage of resources to hold its hand as it faces the future. I expect that, sooner or later, one, the other or both (Geely also owns a chunk of Mercedes) will take a controlling interest, in which case I’ll be looking for a truly vulgar offer to buy my stake in the company.

In the meantime, I feel determinedly optimistic about this company, probably as much as I ever have, even if the market doesn’t agree with me. The signs are there: the DB12 is the first Aston to have been largely developed in the Stroll/Felisa era and it is a triumph. It has the name, it’s getting the product. Profitability and a rampant share price will surely follow. Or am I hoping just a little too much?

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