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On Thursday, Deutsche Bank (ETR:DBKGn) analysts raised the price target for Continental AG (OTC:CTTAY) stock to €80 from €75, while maintaining a Hold rating. This adjustment comes as the company plans significant structural changes, including the listing of its Automotive business in Frankfurt this September.
The analysts noted that Continental intends to present a prospectus for the Automotive business, referred to as SpinCo, this summer. Ahead of the listing, the company will hold a Capital Markets Day on June 24 to provide updates on both SpinCo and RemainCo, the latter being the part of the company that will stay post-spin-off.
Continental’s strategic plans involve separating its business into two distinct entities, offering different investment narratives. The RemainCo is expected to focus on stable cash returns, while SpinCo will undergo restructuring and portfolio adjustments.
Further updates on Continental’s Tire division are anticipated in 2026, potentially aligning with a planned sale of ContiTech. This sale could lead to a rapid reduction in debt for RemainCo, positioning it as a streamlined tire asset.
Deutsche Bank analysts believe that in the long term, RemainCo could achieve a valuation in line with or exceeding its peers, driven by targeted margin improvements and cash generation.
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