Continental

The EU Commission has approved the sale of industrial division Contitech to financial investor Lone Star and sees no competition concerns due to its limited market position. The agreed enterprise value is €4.0 billion plus potential success‑based payments of up to €250 million. Continental’s share reacted positively and was at times around 1.37 percent higher in XETRA trading. » Mere på finanzen.net

The DAX closed little changed at 25,254 points, weighed down by high US yields and oil prices above $100. Continental rose 1.3 percent after an upgrade from Morgan Stanley; Mercedes-Benz and VW also gained, despite the Ifo index for carmakers unexpectedly plunging. Rheinmetall was the day’s top performer, Infineon fell on profit-taking, and Bayer slipped after the company announced a USD 2.2 billion investment in a new pharmaceutical plant in Ohio. The ISM index for non-manufacturing in the US fell slightly but remained in expansionary territory. » Mere på finanzen.net

JP Morgan Chase & Co. analyst Jose M. Asumendi keeps Continental at “overweight” with a €78 target price. The rating is justified by stable product portfolios, pricing power and good predictability of cash flows, which have allowed raw material costs to be offset. He expects Continental’s margin to be at the upper end of the company’s target range and sees a focus on the spin-off of ContiTech as well as a possible upward revision of the outlook. The stock rose intraday by about 2.1% to €69.52, implying roughly 12.2% upside to the target price. » Mere på finanzen.net