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Continental AG (CTTAY)
OTHER OTC:CTTAY
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Continental AG
(OTC:CTTAY)
Rating:73Outperform
Price Target:
$9.50
▲(9.70%Upside)
Continental AG (CTTAY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$17.32B
Dividend Yield3.28%
Average Volume (3M)1.29K
Price to Earnings (P/E)12.4
Beta (1Y)0.66
Revenue Growth-15.44%
EPS Growth78.19%
CountryUS
Employees96,426
SectorConsumer Cyclical
Sector Strength59
IndustryAuto - Parts
Share Statistics
EPS (TTM)0.12
Shares Outstanding2,000,059,800
10 Day Avg. Volume2,815
30 Day Avg. Volume1,289
Financial Highlights & Ratios
PEG Ratio-0.11
Price to Book (P/B)0.08
Price to Sales (P/S)0.00
P/FCF Ratio8.83
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$10.10Price Target Upside16.63% Upside
Rating ConsensusHold
Number of Analyst Covering0
Continental AG Business Overview & Revenue Model
Company DescriptionContinental AG, a leading German automotive manufacturing company, specializes in producing and supplying a wide range of products and services for the automotive sector. Founded in 1871 and headquartered in Hanover, Germany, the company operates through several segments, including Automotive Technologies, Rubber Technologies, and Powertrain Technologies. Continental's core offerings include tires, brake systems, automotive safety, vehicle electronics, and powertrain components. The company is renowned for its innovation in developing advanced solutions for autonomous driving, connectivity, and electrification, serving both original equipment manufacturers (OEMs) and the aftermarket globally.
How the Company Makes MoneyContinental AG generates revenue through a diversified portfolio of products and services across its various business segments. The Automotive Technologies segment provides advanced driver assistance systems, human-machine interface solutions, and electronic components, contributing significantly to the company's earnings. The Rubber Technologies segment, known for producing high-performance tires for passenger cars, trucks, and specialty vehicles, is another major revenue stream. Additionally, the Powertrain Technologies segment offers clean and efficient powertrain solutions, including electrification components, which are increasingly in demand as the automotive industry shifts towards sustainable solutions. Continental's global presence and strategic partnerships with major automotive OEMs and suppliers further bolster its revenue, allowing the company to capitalize on emerging trends in the automotive industry, such as autonomous driving and connectivity.
Continental AG Earnings Call Summary
Earnings Call Date:May 06, 2025
(Q3-2024)
| % Change Since: 8.93%|
Next Earnings Date:Aug 05, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a balanced outlook with significant achievements in cost savings and tire segment performance, offset by persistent challenges in ContiTech and North America, and a lower than expected order intake.Q3-2024 Updates
Positive Updates
Improvement in Adjusted EBIT Margin
The company significantly improved its adjusted EBIT margin by 260 basis points year-over-year, driven by a €125 million cash inflow from Vitesco Technologies.
Strong Performance in the Tire Segment
Tire segment delivered a strong quarter with 3.5% organic sales growth and a 2% volume increase, capitalizing on the passenger vehicle replacement market.
Progress in Automotive Transformation Program
Achieved over 90% of price agreement conclusions, reduced over 3,000 employees, and increased the cost savings target from €150 million to €200 million for 2024.
Strategic Focus on AI and R&D Efficiency
Achieved a 30 basis points reduction in R&D to sales percentage with further AI integration projected to cut development time by up to 20%.
Notable Order Wins in Safety and Motion
Secured €1.8 billion in new business, including major awards from Asian customers, growing the position in the Chinese market.
Negative Updates
Weak Performance in ContiTech
ContiTech faced significant headwinds due to weak industrial and automotive markets, leading to a reduction in sales guidance by €400 million.
Challenges in North American Market
Continued challenges due to customer mix, technology change cycles, and higher inventory levels, affecting performance.
Lower Than Expected Order Intake
New orders of €3.7 billion were below expectations, reflecting delays in customer sourcing decisions due to a challenging market environment.
Revised Group Tax Rate
The group tax rate was revised upward to 30% from the previously assumed 27%, due to foreign minimum taxes and withholding taxes.
Persistent Challenges in ContiTech
No signs of recovery in key markets such as energy and manufacturing, leading to a further reduction in ContiTech’s outlook.
Company Guidance
During the Q3 2024 results call, Continental AG provided an optimistic outlook despite challenging market conditions. The company reported a significant improvement in its adjusted EBIT margin, which increased by 260 basis points year-over-year, partly due to a €125 million cash inflow from Vitesco Technologies. In the automotive sector, Continental successfully concluded most of its pricing negotiations, resulting in a 140 basis points improvement in adjusted EBIT. The tires sector saw a 2% volume growth, driven by strong replacement demand in Europe and APAC, contributing to a 120 basis points increase in adjusted EBIT margin. However, the ContiTech sector faced headwinds due to weak industrial markets, prompting a revised sales guidance between €6.2 billion and €6.6 billion, with an adjusted EBIT margin guidance of 5.8% to 6.3%. Free cash flow was impacted by elevated working capital, despite benefiting from the Vitesco cash inflow. Continental remains committed to its cost-saving initiatives, having achieved €100 million in savings by Q3, and aims for €200 million by year-end, with a total target of €400 million by 2025. The company also noted its strategic efforts in R&D efficiency, aiming for a high single-digit R&D to sales percentage by 2027.Continental AG Financial Statement Overview
Summary
Continental AG's financial health reflects resilience with stable profitability and a balanced capital structure. However, the company faces challenges in maintaining consistent revenue growth and maximizing free cash flow.Income Statement
Continental AG has shown resilience in its income statement with a stable gross profit margin and a recovering net income. However, the revenue growth rate has been volatile, with recent years showing fluctuations. The EBIT margin has improved but remains low. Overall profitability is recovering, but there is room for improvement.68
Positive
Balance Sheet
The balance sheet of Continental AG indicates a solid equity base with a moderate debt-to-equity ratio. The return on equity (ROE) has shown improvement, reflecting better utilization of shareholder funds. The equity ratio suggests a balanced approach to financing, though there is potential to optimize the capital structure further.72
Positive
Cash Flow
Cash flow analysis reveals positive trends in operating cash flow, although free cash flow growth has been erratic. The operating cash flow to net income ratio indicates efficient cash generation relative to net income. However, the free cash flow to net income ratio suggests challenges in translating income into free cash flow consistently.64
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 34.84B | 39.72B | 41.42B | 39.41B | 33.77B | 37.72B |
| Gross Profit | 8.15B | 8.80B | 8.81B | 8.31B | 7.74B | 8.59B |
| EBITDA | 4.56B | 4.55B | 4.21B | 4.01B | 4.11B | 2.46B |
| Net Income | 1.29B | 1.17B | 1.16B | 112.20M | 1.44B | -918.80M |
Balance Sheet | ||||||
| Total Assets | 37.36B | 36.97B | 37.75B | 37.93B | 35.84B | 39.64B |
| Cash, Cash Equivalents and Short-Term Investments | 1.74B | 2.72B | 2.92B | 2.44B | 2.00B | 2.64B |
| Total Debt | 0.00 | 6.88B | 7.16B | 7.67B | 6.24B | 7.32B |
| Total Liabilities | 22.56B | 22.17B | 23.63B | 24.19B | 23.20B | 27.00B |
| Stockholders Equity | 14.37B | 14.35B | 13.68B | 13.26B | 12.19B | 12.26B |
Cash Flow | ||||||
| Free Cash Flow | 1.90B | 980.00M | 1.18B | 126.30M | 1.08B | 587.90M |
| Operating Cash Flow | 3.67B | 2.93B | 3.33B | 2.30B | 2.95B | 2.71B |
| Investing Cash Flow | -1.78B | -1.82B | -2.17B | -2.20B | -1.58B | -1.84B |
| Financing Cash Flow | -1.33B | -1.07B | -1.13B | 653.50M | -1.16B | -1.14B |
Continental AG Technical Analysis
Positive
8.66
Price Trends
8.31
Positive
7.66
Positive
7.01
Positive
Market Momentum
0.03
Positive
54.30
Neutral
24.46
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CTTAY, the sentiment is Positive. The current price of 8.66 is below the 20-day moving average (MA) of 8.68, above the 50-day MA of 8.31, and above the 200-day MA of 7.01, indicating a neutral trend. The MACD of 0.03 indicates Positive momentum. The RSI at 54.30 is Neutral, neither overbought nor oversold. The STOCH value of 24.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CTTAY.
Continental AG Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $14.98B | 11.40 | 15.52% | ― | -2.47% | -43.12% | |
76 Outperform | $7.38B | 27.02 | 5.38% | 1.31% | -8.22% | -52.61% | |
75 Outperform | $5.04B | 11.06 | 10.00% | 3.26% | -3.15% | -6.70% | |
75 Outperform | $8.74B | 13.03 | 28.71% | 2.48% | -2.29% | 35.00% | |
73 Outperform | $17.32B | 12.44 | 10.07% | 3.28% | -15.44% | 78.19% | |
62 Neutral | $16.72B | 10.85 | -7.48% | 3.11% | 1.66% | -24.52% | |
61 Neutral | $14.89B | ― | -22.18% | ― | -0.38% | -1681.25% |
* Consumer Cyclical Sector Average
Performance Comparison
CTTAY
Continental AG
8.66
3.12
56.32%
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113.10
9.06
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BWA
BorgWarner
33.61
2.54
8.18%
APTV
Aptiv
68.78
0.34
0.50%
LEA
Lear
94.32
-16.45
-14.85%
MBLY
Mobileye Global, Inc. Class A
18.34
-9.27
-33.57%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.