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Continental AG (CTTAY)
OTHER OTC:CTTAY
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Continental AG
(OTC:CTTAY)
76Outperform
Continental AG (CTTAY) vs. S&P 500 (SPY)
Market Cap
$13.63B
Dividend Yield2.22%
Average Volume (3M)762.00
Price to Earnings (P/E)10.9
Beta (1Y)0.76
Revenue Growth-1.39%
EPS Growth-12.67%
CountryUS
Employees168,761
SectorConsumer Cyclical
Sector Strength46
IndustryAuto - Parts
Share Statistics
EPS (TTM)0.63
Shares Outstanding2,000,059,800
10 Day Avg. Volume0
30 Day Avg. Volume762
Financial Highlights & Ratios
PEG Ratio9.50
Price to Book (P/B)N/A
Price to Sales (P/S)0.33
Price to Cash Flow (P/CF)N/A
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$9.70Price Target Upside45.65% Upside
Rating ConsensusHold
Number of Analyst Covering1
Continental AG Business Overview & Revenue Model
Company DescriptionContinental AG, commonly known as Continental, is a German multinational automotive parts manufacturing company founded in 1871 and headquartered in Hanover, Germany. The company operates in several sectors, including automotive, rubber, and technology, with a focus on the production of advanced automotive components. Its core products and services encompass tire manufacturing, brake systems, automotive safety, powertrain and chassis components, tachographs, and other parts for the automotive and transportation industries.
How the Company Makes MoneyContinental AG generates revenue through the sale of automotive components and systems, with a significant portion coming from its tire manufacturing operations, which serve both original equipment manufacturers (OEMs) and the replacement market. The company's revenue model is diversified across several divisions: Automotive Technologies, Rubber Technologies, and ContiTech. Automotive Technologies division focuses on electronics, safety, and powertrain components, capitalizing on the growing demand for connected and autonomous vehicle technologies. Rubber Technologies primarily involves tire production for passenger cars, trucks, and specialty vehicles, while ContiTech provides industrial products and solutions leveraging rubber and plastic technologies. Additionally, Continental engages in strategic partnerships and collaborations with other automotive companies and tech firms to enhance its market position and drive innovation, which also contributes to its financial performance.
Continental AG Financial Statement Overview
Summary
Continental AG demonstrates a stable financial position with strong equity and no debt, which is commendable for managing financial risks. However, the company faces challenges in revenue growth and cash flow generation, which need to be addressed to sustain long-term growth. Overall, the financial health is solid with room for improvements in profitability and cash flow efficiency.Income Statement
The income statement shows a solid performance with a gross profit margin of 21.66% TTM and a positive net profit margin of 2.51% TTM. However, revenue has slightly declined by 3.25% TTM compared to the previous year, indicating some pressure in top-line growth. EBIT and EBITDA margins remain modest at 2.07% and 9.24% TTM, respectively, suggesting moderate operational efficiency.72
Positive
Balance Sheet
The balance sheet is robust with an equity ratio of 37.20%, indicating a stable financial foundation. The debt-to-equity ratio is excellent at 0.00 TTM, reflecting no debt burden. The ROE is healthy at 7.31% TTM, showcasing effective use of equity, although it has decreased compared to previous years.85
Very Positive
Cash Flow
Cash flow analysis indicates a decline in free cash flow by 8.46% TTM, which could impact future investments or debt repayments. The operating cash flow to net income ratio is strong at 3.11, indicating good cash generation relative to profit, while the free cash flow to net income ratio stands at 1.08, showing less cash retention.68
Positive
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 40.07B | 41.42B | 39.41B | 33.77B | 37.72B | 44.48B | Gross Profit |
| 8.68B | 8.81B | 8.31B | 7.74B | 8.59B | 10.59B | EBIT |
| 831.30M | 799.60M | 1.33B | 1.79B | -317.60M | -261.50M | EBITDA |
| 3.70B | 4.26B | 4.01B | 4.29B | 3.40B | 4.97B | Net Income Common Stockholders |
| 1.00B | 1.16B | 112.20M | 1.44B | -918.80M | -1.17B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 3.04B | 2.92B | 2.44B | 2.00B | 2.64B | 3.11B | Total Assets |
| 37.75B | 37.75B | 37.93B | 35.84B | 39.64B | 42.57B | Total Debt |
| 7.17B | 7.16B | 7.67B | 6.24B | 7.32B | 7.61B | Net Debt |
| 4.25B | 4.48B | 5.23B | 4.24B | 4.68B | 4.49B | Total Liabilities |
| 23.63B | 23.63B | 24.19B | 23.20B | 27.00B | 26.69B | Stockholders Equity |
| 13.68B | 13.68B | 13.26B | 12.19B | 12.26B | 15.40B |
| Cash Flow | Free Cash Flow | ||||
| 1.08B | 1.18B | 126.30M | 1.08B | 587.90M | 1.19B | Operating Cash Flow |
| 3.12B | 3.33B | 2.30B | 2.95B | 2.71B | 4.41B | Investing Cash Flow |
| -1.96B | -2.17B | -2.20B | -1.58B | -1.84B | -3.65B | Financing Cash Flow |
| -1.18B | -1.13B | 653.50M | -1.16B | -1.14B | -220.00M |
Continental AG Technical Analysis
Negative
6.66
Price Trends
7.24
Negative
6.97
Negative
6.62
Positive
Market Momentum
0.03
Positive
39.05
Neutral
-0.57
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CTTAY, the sentiment is Negative. The current price of 6.66 is below the 20-day moving average (MA) of 7.40, below the 50-day MA of 7.24, and above the 200-day MA of 6.62, indicating a neutral trend. The MACD of 0.03 indicates Positive momentum. The RSI at 39.05 is Neutral, neither overbought nor oversold. The STOCH value of -0.57 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CTTAY.
Continental AG Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $477.40M | 3.22 | 10.41% | 10.86% | -11.02% | -51.66% | |
76 Outperform | $13.63B | 10.95 | 8.43% | 2.22% | -1.39% | -12.67% | |
66 Neutral | $6.56B | 10.55 | 26.69% | 3.25% | -0.80% | 39.95% | |
64 Neutral | $4.42B | 9.18 | 10.81% | 3.74% | -0.70% | -7.27% | |
62 Neutral | $5.98B | 18.10 | 6.46% | 1.62% | -11.10% | -46.32% | |
59 Neutral | $12.18B | 11.09 | -1.08% | 3.77% | 1.26% | -19.82% | |
50 Neutral | $2.77B | 40.20 | 1.49% | ― | -5.92% | ― |
* Consumer Cyclical Sector Average
Performance Comparison
CTTAY
Continental AG
6.66
-0.35
-4.99%
ALV
Autoliv
80.69
-36.46
-31.12%
BWA
BorgWarner
25.89
-8.78
-25.32%
GT
GoodYear Tire
9.70
-3.43
-26.12%
LEA
Lear
81.45
-55.98
-40.73%
TEN
Tsakos Energy Navigation
13.81
-10.31
-42.74%
Continental AG Earnings Call Summary
Earnings Call Date: Mar 4, 2025 | % Change Since: -8.52% | Next Earnings Date: May 6, 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.Highlights
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.
Lowlights
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.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.