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Compagnie Generale des Etablissements Michelin (MGDDY)
OTHER OTC:MGDDY
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Compagnie Generale des Etablissements Michelin
(OTC:MGDDY)
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Rating:66Neutral
Price Target:
$17.00
▲(4.74% Upside)
The overall stock score for MGDDY is primarily influenced by its solid financial performance, despite some concerns over debt and cash flow. The valuation is attractive, with a low P/E ratio and high dividend yield. However, technical indicators suggest bearish momentum, which could pose short-term risks.
Compagnie Generale des Etablissements Michelin (MGDDY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$23.82B
Dividend Yield4.61%
Average Volume (3M)8.34K
Price to Earnings (P/E)14.4
Beta (1Y)0.37
Revenue Growth-3.09%
EPS Growth-17.42%
CountryUS
Employees118,400
SectorN/A
Sector StrengthN/A
IndustryAuto - Parts
Share Statistics
EPS (TTM)0.69
Shares Outstanding1,375,190,300
10 Day Avg. Volume25,032
30 Day Avg. Volume8,344
Financial Highlights & Ratios
PEG Ratio-2.78
Price to Book (P/B)1.21
Price to Sales (P/S)0.83
P/FCF Ratio10.90
Enterprise Value/Market Cap1.13
Enterprise Value/Revenue1.00
Enterprise Value/Gross Profit3.64
Enterprise Value/Ebitda5.98
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Compagnie Generale des Etablissements Michelin Business Overview & Revenue Model
Company DescriptionCompagnie Generale des Etablissements Michelin (MGDDY) is a leading global tire manufacturer based in France, primarily engaged in the design, production, and distribution of tires for various vehicles including passenger cars, trucks, motorcycles, and bicycles. Michelin operates in several sectors, including mobility solutions, sustainable transportation, and tire recycling, and is known for its commitment to innovation, quality, and sustainability in its product offerings. The company's core products include high-performance tires, specialty tires for agricultural and industrial applications, and a range of related services aimed at enhancing vehicle performance and safety.
How the Company Makes MoneyMichelin generates revenue through multiple key streams, primarily by selling tires to both consumer and commercial markets. The company benefits significantly from its extensive product range, which includes premium tire offerings that command higher prices due to their quality and performance. Additionally, Michelin has established long-term partnerships with automotive manufacturers and distributors, which facilitate a steady demand for its products. The company also derives income from value-added services such as tire maintenance, retreading, and fleet management solutions. Furthermore, Michelin invests in innovation and sustainable practices, which not only enhances its brand reputation but also opens up new revenue opportunities in the growing market for eco-friendly and high-efficiency tires.
Compagnie Generale des Etablissements Michelin Earnings Call Summary
Earnings Call Date:Jul 24, 2024
(Q2-2024)
| % Change Since: |
Next Earnings Date:Feb 16, 2026
Earnings Call Sentiment Positive
The earnings call reflected a strong operational performance with significant improvements in operating income and cash flow generation, alongside notable environmental achievements. However, challenges such as volume declines in specialty segments and market distortions from budget tire inflows posed concerns. Overall, the company maintained a positive outlook with strong segment operating income and cash flow targets.Q2-2024 Updates
Positive Updates
Strong Segment Operating Income
Segment operating income reached 13.2% of sales in H1, showing an improvement from 12.1% in H1 2023.
Cash Flow Generation
Generated a strong cash flow of EUR 669 million before acquisition, driven by disciplined budget business management.
Environmental Achievements
Reduced CO2 emissions (Scope 1 and 2) by 7.2% and water withdrawal by 6.3% versus the first semester of 2023.
Record Operating Margin
Achieved 13.2% operating margin, a record high, with a EUR 100 million increase in segment operating income like-for-like.
Positive Mix Improvement
Achieved a strong 1.9% mix improvement, more than offsetting negative price effects from indexation clauses.
Negative Updates
Volume Decline in Specialty Segment
Experienced a 7.2% volume decline in specialties, driven by lower sales in original equipment and mining adjustments.
Negative Pricing Impact
Pricing was negatively impacted by 0.8% due to indexation clauses in the contractual business.
Market Distortions
Distorted markets due to strong inflows of budget tires, particularly in passenger car and light truck segments.
Currency Headwinds
Negative currency effects impacted top-line results, notably from currencies like the Turkish lira and Japanese yen.
Company Guidance
During the Q2 2024 earnings call for Michelin (ML.PA), the company's executives provided robust guidance for the remainder of the year. They projected a segment operating income exceeding EUR 3.5 billion at constant exchange rates and free cash flow surpassing EUR 1.5 billion before acquisitions. In H1 2024, Michelin achieved a 13.2% operating income margin, up from 12.1% in H1 2023, driven by a 1.9% improvement in mix and a strong cash flow generation of EUR 669 million. The company maintained a focus on value-driven approaches and geographical segmentation, with a notable contribution from its Connected Solutions in the road transportation segment. Additionally, Michelin highlighted a favorable operating cost environment, with benefits from raw materials, energy, and seafreight, although labor costs continue to rise. Despite a challenging environment with inflated markets due to Asian tire imports, Michelin's strategic focus on high-value segments and geographies supported its strong financial outlook.Compagnie Generale des Etablissements Michelin Financial Statement Overview
Summary
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Balance Sheet
Cash Flow
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Compagnie Generale des Etablissements Michelin Technical Analysis
Positive
16.23
Price Trends
16.43
Positive
17.08
Positive
17.60
Negative
Market Momentum
0.18
Negative
71.44
Negative
100.18
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MGDDY, the sentiment is Positive. The current price of 16.23 is below the 20-day moving average (MA) of 16.65, below the 50-day MA of 16.43, and below the 200-day MA of 17.60, indicating a neutral trend. The MACD of 0.18 indicates Negative momentum. The RSI at 71.44 is Negative, neither overbought nor oversold. The STOCH value of 100.18 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MGDDY.
Compagnie Generale des Etablissements Michelin Peers Comparison
UnderperformOutperform
Sector (―)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| ― | ― | ― | ― | ― | ― | ― | |
78 Outperform | $9.42B | 12.92 | 31.09% | 2.60% | 0.84% | 26.17% | |
75 Outperform | $6.54B | 15.23 | 8.96% | 2.63% | -1.90% | -13.86% | |
73 Outperform | $2.78B | 9.15 | 23.16% | 0.57% | -4.03% | -39.51% | |
66 Neutral | $23.82B | 14.43 | 8.49% | 4.61% | -3.09% | -17.42% | |
65 Neutral | $10.22B | 76.38 | 2.24% | 1.24% | 0.08% | -83.69% | |
51 Neutral | $2.62B | -1.51 | -45.16% | ― | -3.87% | -482.29% |
* Sector Average
MGDDY
Compagnie Generale des Etablissements Michelin
17.21
1.86
12.10%
ALV
Autoliv
123.97
31.43
33.96%
BWA
BorgWarner
47.79
16.67
53.57%
GT
GoodYear Tire
9.16
0.34
3.85%
LEA
Lear
126.15
36.89
41.33%
VC
Visteon
104.17
21.35
25.77%
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.