I asked ChatGPT to rate my worst-performing UK stock – here’s what it told me

Harvey Jones knew he was making a mistake when he bought this volatile UK stock, and so it proved. So he asked ChatGPT to give its verdict on his purchase.

| More on:

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

I decided to have a bit of fun with ChatGPT and asked what it thought of the worst-performing UK stock in my portfolio.

The company is FTSE 250-listed luxury car maker Aston Martin (LSE: AML). Yes, yes, I know, only an idiot would buy that. But last September, I decided its shares had fallen so far there was surely a chance of making money.

Instead, I’m staring at a 35% paper loss — but I suppose it could be worse. Over 12 months, the Aston Martin share price has plunged 45%. Over five years, it’s collapsed 96%.

Should you invest £1,000 in Aston Martin right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets. And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aston Martin made the list?

See the 6 stocks

Created with Highcharts 11.4.3Aston Martin Lagonda Global Plc PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.co.uk

So I asked my AI chatbot buddy for its view on what is thankfully my worst share purchase (although Ocado Group might have something to say about that).

The Aston Martin share price is a car crash

My question was: Exactly how stupid was I? Happily, my boon robot companion was programmed to be polite and replied: “You weren’t necessarily stupid to invest in Aston Martin, but you did take on significant risk in a company with a volatile history“.

Personally, I think stupidity does come into it. At least I only invested the scrapings of my cash account, rather than a larger sum.

My assumption that Aston Martin was through the worst wasn’t entirely unreasonable, I was happy to hear. “The problem is that a falling stock doesn’t necessarily mean it’s undervalued. Sometimes, it’s a warning sign of deeper, ongoing issues”, ChatGPT said.

It noted that the stock was floated in 2018 at a wildly optimistic valuation of £19 per share. The reality has been brutal, with the shares down to £1.05.

ChatGPT noted that Aston Martin has a history of high debt and poor cash flow, forcing multiple equity raises that diluted shareholders and made recovery harder. “Even after securing backing from investors like Mercedes-Benz and executive chairman Lawrence Stroll, the company still struggles to turn a consistent profit”, it added.

Aston Martin may have an iconic brand but competes against Ferrari, “which operates with higher margins and a more stable financial model“.

Happily, there are reasons for optimism. “Aston Martin has been refreshing its lineup, and the brand’s Formula 1 presence helps keep it relevant. If its new models sell well, revenue could improve.”

This FTSE 250 stock is driving me to drink

If Aston Martin can drive efficiencies and profitability, it could turn a corner (I see what you did there, ChatGPT). Or it could be acquired by a larger automaker or investor looking for a turnaround project.

But ChatGPT had concerns too, warning the group’s £1.3bn net debt limits growth opportunities, especially with interest rates high. The luxury market also continues to struggle.

Overall, ChatGPT isn’t convinced, concluding: “The stock remains highly speculative, and its future depends on execution and external conditions”.

Personally, I would have been harder on myself. I was dazzled by the brand and, worse, by the shallow notion that the shares could snap back and hand me a quick profit.

Most of my portfolio is in solid FTSE 100 blue chips, so maybe I was due a bit of rash fun. I’ll hold onto the shares but won’t take this kind of punt again. It’s making my portfolio look messy and me feel like a chump. Even if ChatGPT is too polite to say.

Should you buy Aston Martin now?

Don’t make any big decisions yet.

Because Mark Rogers — The Motley Fool UK’s Director of Investing — has revealed 5 Shares for the Future of Energy.

And he believes they could bring spectacular returns over the next decade.

Since the war in Ukraine, nations everywhere are scrambling for energy independence, he says. Meanwhile, they’re hellbent on achieving net zero emissions. No guarantees, but history shows...

When such enormous changes hit a big industry, informed investors can potentially get rich.

So, with his new report, Mark’s aiming to put more investors in this enviable position.

Click the button below to find out how you can get your hands on the full report now, and as a thank you for your interest, we’ll send you one of the five picks — absolutely free!

Grab your FREE Energy recommendation now

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Harvey Jones has positions in Aston Martin Lagonda Global Plc and Ocado Group Plc. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Investing Articles

With a 9.5% yield, could this FTSE 250 share be a dividend gold mine?

Christopher Ruane is eyeing a FTSE 250 with a dividend yield approaching double digits. Here's what he likes about it…

Read more »

Investing Articles

2 key reasons Nvidia stock could still soar from here

Even after the chipmaker's stunning performance in recent years, this writer sees reasons that could potentially help propel its share…

Read more »

Investing Articles

Here’s how £10k could set a stock market beginner on the path to riches in 2025!

Christopher Ruane sets out how taking a considered approach could mean even a stock market novice with £10k to invest…

Read more »

Investing Articles

The BAE share price struggles despite strong earnings and a 10% dividend increase. Is it still a buy to consider?

The BAE share price dipped 3% in early morning trading after posting its full-year 2024 results. Our writer considers if…

Read more »

Investing Articles

Could this Nvidia-backed growth stock be a millionaire-maker at $10?

This little-known artificial intelligence growth stock is backed by chipmaker Nvidia and recently jumped nearly 24% in a single day!

Read more »

US Stock

£10,000 invested in the S&P 500 the day before the presidential election is now worth…

Jon Smith explains how the S&P 500 has performed since last November and identifies a key winner in the months…

Read more »

Portrait of elderly man wearing white denim shirt and glasses looking up with hand on chin. Thoughtful senior entrepreneur, studio shot against grey background.
Investing Articles

Should I consider buying Glencore as its share price slumps to multi-year lows?

FTSE 100 stock Glencore continues to see its share price slump. Now at its cheapest since September 2021, should I…

Read more »

Investing Articles

£5,000 invested in Lloyds shares 3 months ago is now worth…

Lloyds shares have done well over the past three months but all of the bank's FTSE 100 peers have done…

Read more »