Aston Martin (LSE: AML) shares briefly perked up Wednesday (25 February) after the luxurious automobile maker posted 2025 full-year outcomes. On the time of writing they’ve dipped round 0.5% — however after a 99% crash since IPO, I’d truly charge {that a} win. What makes me see sparks of optimism right here?
It’s only one factor, which is straightforward to overlook in a sea of probably scary numbers. Nevertheless it is perhaps key. The corporate mentioned: “Improved cash collections in Q4 2025 resulted in modest positive free cash flow in Q4 2025.”
Shareholders have been dreaming of constructive money movement. Now, it was solely £5.1m within the last quarter. And the total yr did see a money outflow of £410m. However in opposition to worldwide tariff turmoil, I didn’t assume Aston Martin was going to attain its year-and money movement hopes. Is that this lastly the beginning of one thing good?
Picture supply: Getty Photographs
Don’t get too excited but
CEO Adrian Hallmark spoke of “an unprecedented backdrop of geopolitical uncertainties and macroeconomic pressures, together with heightened tariffs within the U.S. and China“, in a “extremely difficult buying and selling surroundings“. Proper now actually isn’t the perfect of instances for a struggling high-end automobile firm to be attempting to make a comeback.
He went on to say: “In FY 2026, we anticipate to ship a cloth enchancment in monetary efficiency and proceed delivering year-on-year enhancements over the short-mid-term with a deal with margin growth and money movement technology.“
That will be good, for certain. However the pessimistic facet of me sees a transparent chance that the corporate is placing the absolute best spin it will probably on a dire scenario. The long-term future for Aston Martin shares will rely upon revenue. And there’s none of that.
When will revenue come?
A £259.2m working loss for 2025 is 161% extra painful than the £99.5m loss the yr earlier than. A minimum of we noticed solely a 26% worsening within the yr’s loss earlier than tax, to £363.9m from £289.1m. However that hurts. And web debt rose one other 19%, to hit £1.38bn.
Forecasters anticipate no revenue within the subsequent couple of years. However they see the loss per share halving in 2026. And halving once more in 2027. We may very well be getting dangerously near revenue. The difficulty is, I see a difficult balancing act between every now and then.
How lengthy will the £250m liquidity on the books in December final? What further money will Aston Martin want? How a lot dilution will shareholders face? These are all large unknowns.
Well worth the danger?
A part of me thinks that if all of it turns spherical as hoped, there may very well be some juicy income for traders who make the leap now. I believe they’d face a scary journey… although automobile fanatics would possibly like that type of factor.
However I additionally see an opportunity Aston Martin shares might fall to zero. The corporate might go bust. It has type for that. Besides for individuals who wish to reside dangerously, I believe traders ought to think about safer alternate options.
