PARIS/FRANKFURT (dpa-AFX) – Another profit warning from Michelin (Michelin (Compagnie Générale d Etablissements Michelin SCPA)) did not upset the French tire manufacturer’s investors on Thursday. After the shares had already plummeted around two weeks earlier, the decline was moderate at 0.2 percent to 27.38 euros in the slightly friendly market environment. Despite the cut forecast for currency-adjusted operating profit for 2026, analysts particularly highlighted the company’s distribution plans as positive.
Continental’s papers were also unimpressed by the competitor’s news. They rose by 0.2 percent to 63.56 euros. After suffering from the profit warning from the French in mid-October, their own figures helped the share price make an impressive recovery a few days later. After all, the third quarter of the German tire and plastics technology group was more profitable than expected and the annual targets were confirmed by management.
JPMorgan analyst Jose Asumendi wrote to Michelin that in the company’s volatile business environment, the focus will likely be on its payouts. He referred to the free cash inflow of around 1.7 billion euros expected for 2025 and 1.8 billion in 2026. Michelin has also accelerated its share buyback program and is planning an additional 400 million euros for buybacks by the end of the year.
However, Asumendi took the detailed figures as an opportunity to lower his estimates for adjusted earnings before interest and taxes for 2025 and 2026 and thus also his price target from 30 to 27 euros. For both years it is slightly below the consensus estimate determined by Bloomberg.
According to analyst Christoph Laskawi from Deutsche Bank, there is currently “a lot to digest” at Michelin. Not only were there additional details about the profit warning from October 13th and the current uncertainties for the rest of the year, the outlook for 2026 has now also been rejected. But he also highlighted the announced share buybacks as positive and that Michelin had maintained its forecast for free cash inflow. According to him, this “once again demonstrates the strong cash generation profile”.
“The acceleration of share buybacks is an important development,” said Ross MacDonald of Citigroup. “Buying back 2 percent of shares in two months could be enough to offset the cuts of about 7 percent from the outdated consensus resulting from the profit warnings.”
Only ten days ago, Michelin cut its target for the annual operating result for 2025, after which the share price fell by a peak of 11 percent. The first downward trend had already begun a few days earlier after analysts had reacted negatively to information from management in a “pre-close call” about the upcoming figures and had already questioned the annual targets for 2025. In the period between October 8th and 14th, the share price had lost a total of around 17 percent./ck/men/mis
Selected leverage products on Continental
With knock-outs, speculative investors can participate disproportionately in price movements. Simply select the lever you want and we will show you suitable open-end products on Continental
The leverage must be between 2 and 20
Advertising