(News Bulletin 247) – Michelin goes public on Monday following a recommendation upgrade from Goldman Sachs, which sees the horizon clearing for the French manufacturer after its recent underperformance.
Around 2:15 p.m., the title of the French tire manufacturer gained 3.1%, signing in passing the second largest increase in the Parisian CAC 40 index, which won 1.6% at the same time.
Goldman Sachs, which is changing to ‘buy’ versus ‘neutral’ on value, notes that the stock has underperformed the sector along with rivals Continental and Pirelli since the start of the year, a gap the analyst attributed to the cautious outlook communicated by the Clermont group.
But after a first quarter that it expects to be difficult, Michelin should, in its view, take advantage from the second quarter of a recovery in its volumes, a favorable effect on the level of prices and a decline in the costs of raw materials and transportation, he says.
The American bank thus raises its price target from 27 to 35 euros, which shows an upside potential of around 20%.
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