Continental (AO) | Buy | Solid Q2 and record cash returns ahead following the ContiTech transaction

研报英文原文证据摘录

Continental (AO) | Buy | Solid Q2 and record cash returns ahead following the ContiTech transaction

Earnings preview

Release date: 02 July 2026

Thomas Besson

Head of Autos Research

+33 1 70 81 57 53

tbesson@keplercheuvreux.com

BuyContinental

Germany | Autos & parts Beta Profile: MCap: EUR14.5bn

Target Price: EUR75.00 Bloomberg: CON GR Reuters: CONG.DE

Current Price: EUR72.34 Free float 54%

Up/downside: 3.7% Avg. daily volume (EURm) 58.0

YTD abs performance 6.4% Market data: 01 July 2026

52-week high/low (EUR) 78.38/53.84

Solid Q2 and record cash returns ahead following the ContiTech

transaction

Key points:

Continental hosted its group pre-close call last night, post-close, with a confident message on the FY26 outlook and the

ContiTech disposal process ahead of Q2 print on 4 August.

The message on the quarter is consistent with our estimates and the FY26 guide with soft volumes both in Tyres and at ContiTech

in Q2 again, but margin improvement to expect YOY in Tyres from price mix strength and raw materials’ tailwind, and ContiTech

softer sequentially but well within the target range for H1. The range for tyre margins may be tweaked up at the Q2 stage, in our

view.

We confirm our Buy rating with an unchanged EUR75 TP at this point. Continental offers visible margins and earnings

improvement in 2026-27 backed by demonstrated pricing power, strong, sustained FCF generation, a shareholder-friendly

approach and low valuation metrics. The expected ContiTech transaction should drive strong cash returns for shareholders.

Soft volumes in Tyres offset by a solid price mix, solid margins - A similar picture as Q1 for Tyres

Continental should report lower tyre volumes in Q1 (KECH -3.8%) on weak OE markets and softer European sell-in replacement after