FRANKFURT -- ABN AMRO cut its price target for DaimlerChrysler to 30 euros from 32 on Wednesday, citing its exposure to a potential downturn in the U.S. car market amid high oil prices and rising interest rates.
In a note to clients, analyst Tom Borland also raised his price target for French carmaker PSA Peugeot Citroen, which he said was relatively immune to these dangers.
"DaimlerChrysler's exposure to the U.S. economy is by far the highest of the companies covered here," he said in a report suggesting that investors switch into European car stocks from American carmakers.
He said Chrysler would be seriously affected by more difficult conditions in the U.S. light vehicle market, while the earnings at Mercedes Car Group could be hurt as hedges against the euro's strength start to run out.
"It is possible to envisage some very ugly scenarios for the U.S. economy and light vehicle market over the next 12 months, and in the light of these risks, the DaimlerChrysler share price seems to us to be too high," he said, reiterating his "sell" rating on the stock.
It was trading at 33.70 euros at 1535 GMT, down 0.2 percent, broadly in line with the DJ Stoxx European car index.
He retained an "add" rating for PSA stock and raised his share price target to 50 euros from 48.
"Of the European car manufacturers, Peugeot is by far the safest haven from the risks we have discussed here, simply because of its absence from North American markets," he said.