Porsche loses its blue chip status after a 24% drop. What to do with the stock?

German premium car manufacturer Porsche will be excluded from the main German stock index DAX for the first time in three years. This comes after a long fall in the company's shares, associated with the damage from US duties and difficulties in the Chinese car market. The company's management hopes to return to the index soon, while analysts are mostly cautious about its shares.

Porsche AG (ticker P911) will be excluded from the German blue-chip index DAX, starting September 22, said the operator of the index STOXX. This index includes the 40 largest German companies whose securities are traded on the stock exchange in Frankfurt. The company will leave the DAX for the first time in three years: it entered it immediately after the IPO, which held in 2022.

At the same time as Porsche, pharmaceutical company Sartorius will exit the index. They will swap places with digital company Scout24 and food processing equipment manufacturer GEA Group, which will move up in the DAX from the MDAX mid-cap index.

The exclusion from Germany's main stock index followed a long fall in the shares of the luxury car manufacturer, writes CNBC. Quotes of Porsche AG on the German stock exchange Xetra fell by 24% in 2025, and over the past 12 months they have fallen by 34%.

Porsche has suffered this year due to U.S. duties and difficulties in the Chinese car market, which has affected the stock, The Wall Street Journal explained. Porsche has been particularly affected by the import duties, CNBC said. The problems forced Porsche to cut its own forecasts several times, which did not make investors happy.

The management of Porsche has remained optimistic after its exclusion from the DAX. The company intends to return to the index "as soon as possible," CEO Oliver Blume said in an interview with German newspaper FAZ. He claims that the reason for exclusion from the DAX was technical criteria.

"According to the rules of Deutsche Börse (the leading German stock market operator. - OnInvest), only free float is taken into account in the formation of the DAX index - and Porsche AG has a relatively small free float: only about 12%. Therefore, the index has to compete with companies that have a smaller market capitalization but a much larger free float," Blume said. Looking at the capitalization and "shine" of the Porsche brand, the company remains one of the largest in Germany, he added.

Investors of Porsche AG reacted with restraint to the news of exclusion from the DAX: quotations on the Xetra exchange decreased in trading on Thursday by about 0.6% - to €44.3.

In August, several analysts revised their estimates for the company's shares. For example, RBC analyst Tom Narayan reiterated a neutral rating, but lowered his target price from €45 to €43. That estimate now implies that the stock is down 5% (compared to its closing level on Sept. 3).

Warburg Research also maintained a neutral rating for Porsche in August, leaving the target price at 41 euros. This implies a drop in quotations by 8.5%. After a decade of sustained success, the sportscar maker's strategy is facing new challenges, Warburg Research analyst Fabio Helschera said at the time. He said the process of realigning the strategy could permanently limit the company's growth rate and profitability. The duration of this period remains uncertain and will largely depend on geopolitical factors, the analyst wrote.

A total of 24 analysts have rated Porsche shares, MarketWatch shows. The majority (14) are neutral and advise to keep securities in portfolio (rating Hold). A month ago the company had 11 such recommendations. Four analysts offer to buy securities of the automaker (rating Buy), six - advise to sell (Underweight and Sell).

This article was AI-translated and verified by a human editor