Volkswagen AG reports first-half results on June 18 against a backdrop where the cost of borrowing its shares has tripled over the past month — a quiet but pointed signal that short-seller conviction is building ahead of the print.
Borrowing costs have climbed sharply. The cost to borrow VOW3 shares now runs at 2.76%, up from well below 1% through most of May — a rise of more than 215% over the past 30 days. The move gathered pace last week, with CTB spiking to 3.66% on June 12 before settling back slightly. That said, borrow availability remains extremely loose at over 620%, meaning there are far more shares available to lend than are currently borrowed. The demand for borrows is rising, but the lending pool is not under strain. Short interest itself is a modest story: at roughly the low single digits as a percentage of free float, and a short score of 39 (up from 37 earlier in the month but not in extreme territory), the picture is one of growing caution rather than outright bearish crowding.
The bull and bear debate on Volkswagen has been well-worn for months. Bears point to ongoing competitive pressure in China, where domestic EV makers have eaten deep into VW's market share, and to cost restructuring that has yet to deliver visible margin improvement. A recent ORTEX note flagged that the stock has underperformed European peers year-to-date. Bulls have more to work with than the price action suggests: the forward EPS trajectory has improved materially, with the 12-month forward EPS growth estimate sharply higher than it was six months ago. The analyst consensus leans constructive — five outperform ratings, with no recent downgrades — and the factor score for analyst recommendation differential ranks in the 92nd percentile. Valuation remains deeply undemanding, with a price-to-earnings ratio near 4x and a price-to-book below 0.25x. The stock has added about 2.7% over the past week, modestly lagging peers like (+6.8%) and (+2.1%), though it has held up better than (-2.0% on the week).
The ownership structure adds little near-term drama. Porsche Automobil Holding holds 31.4% and the state of Lower Saxony controls another 5.7% — neither is a source of selling pressure. Among active managers, BlackRock added roughly 327,000 shares through May, and Dimensional Fund Advisors added a similar amount. The institutional flow is incrementally positive but not a decisive signal either way. Insider data is stale (the most recent trade on record dates to September 2023), so it offers nothing useful heading into this print.
The June 18 release is therefore less about whether VW can grow earnings on paper — the forward revisions suggest it can — and more about whether management can demonstrate that the cost and competitive headwinds in Europe and China are stabilising at a margin profile that justifies re-rating a stock still priced for distress.
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