Bernstein has begun covering Subaru (FUJHY), assigning the automaker an Underperform rating. This move is part of a broader initiation of coverage on the Japanese autos and auto parts sector, which Bernstein views with a bearish stance. The firm highlights that while current sector valuations already reflect caution due to declining sales and loss in market share, additional selectivity is necessary.
The analyst notes that geopolitical risks present short-term challenges for the sector. Moreover, the transition toward electrified propulsion vehicles is expected to influence the market dynamics over the mid to long term. Given these factors, Bernstein advises investors to approach the sector with heightened selectivity.
