PEERS & MARKETS - Pirelli · PEERS & MARKETS 16 - 20 March, ... Pirelli Investor Relations, ... Continental ¼ 226.00 0.2 5.0 30.2 36.8 28.7 641,246 577,931 579,422 608,910

PEERS & MARKETS

16 - 20 March, 2015

Date Close price 1W % chg YtD % chg

20-Mar-15 15.23€ 2.4 35.9

20-Mar-15 91.25€ 0.8 21.2

20-Mar-15 226.00€ 0.2 28.7

20-Mar-15 27.93€ 5.5 37.7

20-Mar-15 25.66$ 1.7 (10.2)

20-Mar-15 4,807¥ (1.3) 14.5

20-Mar-15 45,800₩ (4.0) (13.1)

Paris - CAC 40

Tokyo - Nikkei 225

New York - NASDAQ

Seul - KOSPI

Market

Milano - FTSE Mib

Frankfurt - DAX

Helsinki - HEX

23.03.2015 – Weekly Newsletter March 16 – 20, 2015

Pirelli Investor Relations, Competitive & Business Insight 2

YtD

Performance

Sell side analysts evaluation on Pirelli & C.

weekly

Source Bloomberg

Pirelli & C. on the Stock market

Consensus Target Price: €13.71

% Buy: 41%

% Hold: 50%

% Sell: 9%

Latest reports (22 reports)

Official Close

20-Mar 1 Week 1 Month 3 Months 6 Months Year to Date 1 Week 1 Month 3 Months 6 Months

Pirelli & C. Ord. 15.23€ 2.4 12.7 38.6 29.9 35.9 9,810,857 4,851,335 3,377,232 3,129,251

Pirelli & C. Risp. 15.20€ 10.9 25.4 54.0 41.4 52.3 246,544 91,708 56,020 41,029

FTSE All Share 3,788€ 3.8 1.7 7.8 3.9 7.2 1,426,685,461 1,300,171,185 1,169,450,753 1,181,779,083

FTSE Mib 23,177€ 2.0 6.1 22.1 10.5 21.9 877,991,691 862,725,894 862,467,518 848,037,649

Percentage change (%) Daily average volumesMarket Cap.

23-Mar

Ord. 7,240.2

Risp. 180.0

Tot. Pirelli 7,420.2

Pirelli +35.9% +2.4%

FTSE Mib +21.9% +2.0%

Stoxx A&P +33.0% -1.2%

30-Dec 6-Jan 13-Jan 20-Jan 27-Jan 3-Feb 10-Feb 17-Feb 24-Feb 3-Mar 10-Mar 17-Mar

PIRELLI & C. VS FTSE MIB - 2015 YtD trend



Markets Official Close

20-Mar1 Week 1 Month 3 Months 6 Months

Year to

Date

DJ Stoxx 600 404 1.9 5.7 18.7 15.9 17.9

Auto 667 (1.2) 6.9 33.3 38.4 33.0

Banks 214 2.4 5.0 14.1 4.8 13.4

Basic Resources 416 3.6 (1.7) 13.0 (1.0) 10.6

Chemical 971 1.2 8.7 24.3 24.5 23.5

Construction & Material 408 1.3 4.7 23.3 24.3 21.9

Finance 460 2.4 6.9 23.1 29.5 21.9

Food & Beverage 647 0.7 6.1 18.1 19.9 17.4

FTSE EPTRA Eu Residential 861 1.5 1.3 22.4 35.8 19.8

Industrial 482 0.5 4.9 20.0 17.7 18.7

Insurance 305 2.9 9.9 22.0 25.2 21.8

Media 327 0.5 5.8 22.2 26.2 19.9

Oil & Gas 315 5.9 0.1 9.5 (10.3) 10.7

Retail 373 2.1 5.7 23.0 21.6 19.8

Technological 369 1.3 7.9 20.3 22.4 18.3

TLC 372 0.7 3.3 15.9 22.8 16.2

Travel & Leisure 260 0.6 7.9 19.6 29.9 16.9

Utilities 332 3.7 4.0 5.8 2.7 5.3

S&P 500 2,108 2.7 (0.1) 1.8 4.9 2.4

Auto 221 2.6 (0.1) 8.1 (0.0) 4.2

Banks 327 0.4 1.8 (0.5) 1.3 (1.2)

Basic Resources 158 1.8 (8.7) (7.7) (22.0) (7.0)

Chemical 538 (1.0) (4.1) 1.5 (1.7) 1.8

Finance 453 2.1 1.2 1.1 6.4 1.1

Food & Beverage 497 1.6 (2.4) (1.0) 2.3 (0.3)

Insurance 457 1.7 0.1 (0.5) 4.4 (0.3)

Media 786 2.1 2.0 5.4 8.0 4.5

Oil & Gas 571 2.1 (5.0) (8.4) (14.9) (7.4)

Real Estate 319 5.1 2.1 5.8 15.8 6.2

Retail 821 2.1 2.4 10.5 21.1 8.6

Technological 1,107 3.0 (1.0) 2.3 5.4 3.1

TLC 166 1.6 (0.7) 2.8 (3.4) 3.0

Tyres 96 2.0 (4.4) (2.8) 12.8 (5.1)

Utilities 224 4.2 (1.1) (3.6) 6.0 (4.5)

Percentage change (%)

Un

ite

d S

ta

tes

Eu

ro

pe

Official Close

20-Mar1 Week 1 Month 3 Months 6 Months

Year to

Date

FTSE Mib 23,177 2.0 6.1 22.1 10.5 21.9

FTSE 100 7,023 4.2 1.6 7.3 2.7 7.0

DAX 12,039 1.2 8.9 23.0 22.9 22.8

CAC 40 5,087 1.5 5.3 19.9 14.0 19.1

IBEX 35 11,420 3.5 5.0 10.2 3.8 11.1

FTSE Athex 744 (3.3) (12.8) (13.7) (35.2) (9.9)

OMX Stockholm 552 2.7 2.2 17.5 21.6 16.5

OMX Helsinki 9,199 1.9 5.4 19.7 19.3 19.2

FTSE Athex 744 (3.3) (12.8) (13.7) (35.2) (9.9)

Swiss Market 9,396 2.6 5.7 4.7 6.3 4.6

DJ Industrial Average 18,128 2.1 (0.1) 1.8 4.9 1.7

S&P 100 922 2.3 (0.4) 0.8 2.8 1.6

NASDAQ Composite 5,026 3.2 1.4 5.5 9.8 6.1

SSE Composite (Cina) 2,681 7.4 9.6 12.1 65.5 3.8

Nikkei 225 (Japan) 19,560 1.6 6.7 11.0 19.8 12.1

Hang Seng (HK) 24,375 2.3 (1.8) 5.4 0.3 3.3

All Ordinaries (Australia) 5,936 2.6 1.6 11.7 9.2 10.2

Strait Times (Singapore) 3 1.8 (0.6) 3.0 2.7 0.3

BSE 30 (India) 5,936 2.6 1.6 11.7 9.2 10.2

KOSPI (S. Korea) 2,037 2.6 3.9 5.6 (0.8) 6.4

Abu Dhabi 4,338 (3.3) (7.1) (0.6) (17.1) (4.2)

Dubai 3,473 (6.3) (10.0) 1.4 (31.9) (8.0)

Saudi Arabia 9,174 (5.3) (1.4) 10.3 (17.1) 10.1

Bovespa (Brasile) 51,967 6.9 1.4 4.7 (10.1) 3.9

IPC (Mexico) 43,968 (0.1) 1.0 3.4 (3.9) 1.9

Merval (Argentina) 11,385 11.1 20.6 41.9 (1.7) 32.7

IBC (Venezuela) 4,649 2.2 36.1 22.2 67.3 20.5


Eu

ro

pe

U.S

.A

.A

sia

P

ac

ific

G.C

.C

.L

atA

m

Source Bloomberg



Pirelli & C. vs Auto & Parts Sector

DJ Stoxx Auto & Parts:

EUROPE: WEEKLY TREND TYRES & AUTO STOCKS vs DJ STOXX AUTO & PARTS

TYRE AUTO

Source Bloomberg

-1.2%

Official Close

20-Mar 1 Week 1 Month 3 Months 6 Months Year to Date 1 Week 1 Month 3 Months 6 Months

DJ Stoxx 600 A&P 666.63€ (1.2) 6.9 33.3 38.4 33.0 67,660,371 48,870,947 41,758,412 44,445,941

TYRE

Pirelli & C. 15.23€ 2.4 12.7 38.6 29.9 35.9 9,810,857 4,851,335 3,377,232 3,129,251

Continental 226.00€ 0.2 5.0 30.2 36.8 28.7 641,246 577,931 579,422 608,910

Michelin 91.25€ 0.8 6.6 23.3 14.4 21.2 1,026,118 835,866 844,211 829,532

Nokian 27.38€ 5.5 3.1 34.5 14.0 37.7 1,189,612 948,349 1,119,520 1,100,338

AUTO

FCA 15.20€ (2.6) 13.1 62.8 116.4 58.3 25,943,144 18,994,267 17,203,928 18,743,982

Renault 83.88€ (5.8) (1.5) 38.3 41.1 38.6 1,502,565 1,260,129 1,253,824 1,350,577

Peugeot 15.79€ (2.4) 11.0 52.9 51.9 54.5 9,837,880 6,819,001 5,364,524 5,230,955

Volkswagen (pref.) 250.05€ 0.9 11.1 35.0 41.8 35.4 1,680,671 1,325,132 1,188,348 1,182,990

BMW 116.75€ (2.7) 5.1 29.8 31.2 30.1 2,555,540 1,883,285 1,720,604 1,813,098

Daimler 91.51€ (1.7) 7.9 32.5 43.5 32.7 5,988,682 4,385,224 4,368,154 4,313,899

DJ US A&P 335.28$ 2.6 (0.4) 5.6 4.9 3.4 19,985,434 16,822,223 16,741,776 17,370,570

TYRE

Goodyear 25.66$ 1.7 (7.3) (8.6) 7.3 (10.2) 3,001,343 3,012,315 3,656,837 4,105,646

Cooper 40.20$ 3.1 6.6 21.9 35.3 16.0 792,921 1,149,606 885,899 900,199

AUTO

Ford 16.48$ 1.7 0.5 9.6 (1.0) 6.3 30,065,571 25,445,363 27,051,094 31,611,432

General Motors 38.87$ 2.2 3.2 18.5 14.5 11.3 13,727,806 12,784,175 15,288,697 15,091,236

Tesla 198.08$ 5.0 (8.8) (9.7) (23.6) (10.9) 5,587,130 5,641,860 4,953,339 5,619,344

Japan A&C 261,570¥ 1.2 4.3 9.8 21.1 10.4 69,224,200 68,510,538 72,110,237 79,136,986

TYRE

Bridgestone 4,807¥ (1.3) 3.2 11.1 30.7 14.5 2,815,433 3,265,338 3,624,353 3,749,599

Sumitomo 2,162¥ (1.2) 3.3 16.7 36.1 20.1 1,083,750 1,138,971 1,174,778 1,285,680

Yokohama 1,228¥ (1.2) 5.0 5.0 26.1 11.1 1,847,333 1,850,095 1,800,610 1,783,508

Toyo 2,372¥ (14.4) (5.8) (5.1) 25.8 (0.6) 6,428,817 2,606,495 1,740,873 1,521,365

Hankook 45,800₩ (4.0) (4.6) (13.1) (12.9) (13.1) 349,407 397,041 382,713 337,498

Kumho 9,860₩ (0.3) 5.8 (4.3) (12.4) 2.0 819,921 1,024,174 899,279 789,999

AUTO

Toyota 8,598¥ 4.1 6.4 13.7 32.4 13.8 9,875,433 8,794,090 9,134,798 10,468,216

Honda 4,117¥ (0.5) 3.8 15.0 9.6 16.7 5,439,450 5,039,138 5,567,446 6,497,971

Nissan 1,271¥ (2.2) 5.4 21.2 18.1 20.2 11,046,400 11,541,810 11,838,224 12,878,371

Asia

Daily average volumes

U.S

.A

.E

uro

pe


+3.6 pp +1.4 pp +2.0 pp

+6.7 pp

-1.4pp -4.6pp

-1.2pp

+2.1 pp

-1.5pp -0.5pp

Pirelli & C. Continental Michelin Nokian FCA Renault Peugeot Volkswagen(pref.)

BMW Daimler



2015 YtD performance

Pirelli & C. vs FTSE Mib Relative Performance (YtD)

Source Bloomberg

FTSE Mib

+21.9% YtD

2014 FY Relative performance:

-19.3

pp

-19.2

pp

-17.7

pp

-15.1

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-13.7

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-13.2

pp

-9

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-9.8

pp

-9.7

pp

-6.9

pp

-4.2

pp

-3.8

pp

-3.3

pp

-2.9

pp

-2.1

pp

-0.1

pp

+0.7

pp

+2.1

pp

+3.0

pp

+3.5

pp

+3.6

pp

+4.8

pp

+5.4

pp

+6.1

pp

+6.9

pp

+7.2

pp

+7.8

pp

+14.0

pp

+16.2

pp

+16.5

pp

+16.7

pp

+18.8

pp

+21.0

pp

+22.5

pp

+24.3

pp

+25.1

pp

+25.9

pp

+26.8

pp

+36.4

pp

+50.4

pp

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-9.3

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36

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.9 p

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Tyre Sector Evaluation Multiples

Source Bloomberg

2014 2015 2016 2014 2015 2016 2014 2015 2016 2014 2015 2016

PIRELLI 18.1x 15.0x 13.3x 1.6x 1.5x 1.4x 7.5x 6.7x 6.1x 11.3x 10.1x 9.3x

Michelin 12.9x 12.4x 11.2x 0.9x 0.9x 0.9x 5.2x 4.8x 4.4x 8.2x 7.5x 7.1x

Continental 17.3x 16.3x 14.7x 1.5x 1.3x 1.2x 9.4x 8.1x 7.2x 13.1x 11.7x 10.9x

Nokian 18.0x 18.7x 16.3x 2.6x 2.7x 2.5x 9.2x 9.8x 9.0x 11.7x 12.9x 11.6x

Simple average 16.6x 15.6x 13.9x 1.6x 1.6x 1.5x 7.8x 7.3x 6.7x 11.1x 10.6x 9.7x

Weighted average * 16.4x 15.4x 13.9x 1.4x 1.3x 1.2x 8.2x 7.3x 6.5x 11.7x 10.6x 9.9x

Goodyear 9.1x 8.8x 7.6x 0.7x 0.7x 0.7x 5.3x 4.7x 4.3x 7.7x 6.8x 6.2x

Bridgestone 12.2x 10.6x 10.1x 1.1x 1.0x 1.0x 6.1x 5.3x 4.9x 8.3x 7.4x 7.1x

Sumitomo 11.0x 10.0x 9.4x 1.0x 0.9x 0.9x 6.8x 6.0x 5.6x 9.9x 9.2x 8.8x

Yokohama 9.7x 9.5x 8.8x 0.9x 0.9x 0.8x 6.4x 5.8x 5.2x 9.5x 8.3x 7.8x

Hankook Tire 7.7x 7.5x 6.9x 1.0x 1.0x 0.9x 4.7x 4.7x 4.2x 6.6x 6.6x 6.1x


Weighted average * 9.3x 8.3x 7.8x 0.9x 0.8x 0.8x 5.0x 4.4x 4.0x 6.9x 6.2x 5.9x

max 18.1x 18.7x 16.3x 2.6x 2.7x 2.5x 9.4x 9.8x 9.0x 13.1x 12.9x 11.6x

min 7.7x 7.5x 6.9x 0.7x 0.7x 0.7x 4.7x 4.7x 4.2x 6.6x 6.6x 6.1x

median 12.2x 10.6x 10.1x 1.0x 1.0x 0.9x 6.4x 5.8x 5.2x 9.5x 8.3x 7.8x


Weighted average ** 14.3x 13.2x 12.0x 1.2x 1.2x 1.1x 7.3x 6.5x 5.9x 10.3x 9.4x 8.8x

* on peers market capitalization by geographical area

** on tyre sector market capitalization

million Local currency € adjustment % on cluster

€7,420 7,420 6.1%

€16,950 16,950 13.9%

€45,201 45,201 37.0%

€3,728 3,728 3.1%

$6,922 6,382 5.2%

¥3,908,176 30,035 24.6%

¥568,699 4,371 3.6%

¥420,711 3,233 2.6%

₩5,673,478 4,702 3.9%

TOT. 122,022

EU

RO

PE

AS

IA

WORLD TYRE MARKET CAP

P / E

US

TO

T.

WO

RL

D

EV / SALES

TYRE MULTIPLES @

EV / EBITDA EV / EBIT

20-Mar-15

PIRELLI

Michelin

Continental

Nokian

Goodyear

Bridgestone

Sumitomo

Yokohama

Hankook Tire

CONSENSUS PEERS TYRE MARKET MULTIPLES



Source: Pirelli IR analysis on broker estimates

Pirelli & C. Consensus Estimates

PIRELLI & C. CONSENSUS FY 2014A Preliminary

Results

CONSENSUS ESTIMATES

23-Mar-15 FY 2014E FY 2015E FY 2016E

€ mln # estimates # estimates # estimates

Revenues 6,018 6,018 22 6,431 22 6,817

Ebitda before restructuring costs 1,168 1,168 16 1,283 15 1,383

Ebitda margin before restructuring costs (%) 19.4% 19.4% 16 20.0% 15 20.3%

EBIT before restructuring costs 869 869 17 964 16 1,045

EBIT margin before restructuring costs (%) 14.4% 14.4% 17 15.0% 16 15.3%

Restructuring costs -31 -31 17 -31 16 -22

EBIT 838 838 22 931 22 1,017

EBIT margin (%) 13.9% 13.9% 22 14.5% 22 14.9%

Net Income 17 369 22 479 22 554

Net Debt 980 980 22 872 22 630

Documents

PEERS & MARKETS - Pirelli · PEERS & MARKETS 16 - 20 March, ... Pirelli Investor Relations, ... Continental ¼ 226.00 0.2 5.0 30.2 36.8 28.7 641,246 577,931 579,422 608,910