Should I buy Aston Martin shares for my ISA while they’re under 70p?

Just when you think Aston Martin Lagonda (LSE: AML) shares can’t go any lower, they do. Now at 66p, they’re down 39% in six months, 56% over a year, and 98% since listing in late 2018.

The share price trend seems so bearish that any positive news at all could spark a sudden turnaround. Therefore, I’ve been digging into the FTSE 250 struggler again to see if it might be worth me buying a few shares for my ISA.

Top brand

There are a few things that I like about Aston Martin. The most obvious is the luxury brand, which exudes British refinement and style. No doubt James Bond immortalised that image in people’s minds.

Also, the brand has a loyal following. And although it’s not as popular as Ferrari or Lamborghini in emerging markets, I see no reason why the British luxury carmaker can’t eventually appeal to rich people everywhere. The Aston Martin name also competes in Formula 1 nowadays, which is good for ongoing global brand recognition.

Another thing I like here is new(ish) CEO Adrian Hallmark. Prior to joining Aston Martin, he served as the boss of Bentley for a number of years, where he led the company through a significant turnaround. After a revolving door of chief executives, the firm might finally have found the right match.

Lastly, the stock looks cheap, trading at just 0.39 times sales. If the loss-making firm can swing to profitability at some point over the next few years, the share price could take off like a rocket.

Balance sheet concerns

Unfortunately, there are a few things I don’t like. The main one is that net debt increased by 43% last year, rising from £814m to £1.16bn. For context, the firm’s market cap is only £626m.

The company’s adjusted net leverage ratio rose from 2.7 to 4.3, reflecting both higher debt and reduced EBITDA due to lower sales. Management aims to reduce this significantly over the medium term, but this issue simply can’t be ignored.

And while the firm aspires to be free cash flow positive in the second half of 2025, actual profits seem a distant prospect. This lack of profitability puts me off, especially when combined with the hefty debt.

On top of this, the company is facing sluggish sales in China and the prospect of steep 25% tariffs in the US. Even if the UK government negotiates a trade deal with the US, there is no guarantee that all car tariffs will be lifted entirely.

My move

Aston Martin has been promising a turnaround and profitable future for many years. Yet it’s often been one step forward, two steps back when it comes to actually delivering the goods.

I already hold shares of Ferrari in my portfolio. While it might seem unfair to compare the two businesses, Aston Martin said it aspired to emulate the iconic Italian automaker prior to its 2018 IPO. So it seems appropriate to do so after seven years.

As we can see, there really is no comparison. I would be open to investing in another luxury goods company, but unfortunately not Aston Martin, as things stand.