Michelin (1K) | Buy | Diversification is a long-term strategic angle

研报英文原文证据摘录

Michelin (1K) | Buy | Diversification is a long-term strategic angle

Michelin Buy | Target Price: EUR40.00

Company description Management

Cie Generale des Etablissements Michelin produces tyres and other rubber products, Florent Menegaux, Managing Partner and CEO

steel cables, maps, gastronomy and tourist guides, as well as providing services and Bénédicte de Bonnechose, CFO

solutions to improve transport efficacy. The company's tyre products are used for

automobiles, trucks, aircraft, bicycles, and industrial vehicles. Michelin manufactures Key shareholders

and distributes its products worldwide. Based in Clermont-Ferrand, Michelin is Free float 95.80% Non-resident Institutional Investors 67.00%

present in 175 countries and employs over 130,000 people. French Institutional 20.40%

Individual shareholders 10.50%

Investment case Valuation methodology

n Structurally sound cash generation and a strong balance sheet n It would trade at 6x EV/EBITDA 2026E, 15x earnings, and 1.5x

should help make Michelin a more resilient name than the P/BV at our TP, close to its historical average with improved

sector average. Rising cash returns and a constant focus on returns and a stronger balance sheet.

passing through inflationary headwinds also provide key n Relative operating metrics clearly improving versus

support. European/global peers.

n Volume developments have disappointed since Q4 2024 but n DCF seems to be a relevant methodology given its track record

they should progressively rebound over 2026-27. The raw and structural improvements, suggesting a fair value

material price mix spread should remain positive in 2026 (as in exceeding EUR50 (9% WACC, 2.5% g).

2021-25), as the company continues to offset inflationary Risks to our rating

elements.