Analysts Hail ‘10x Better Than Expected’ Continental Results

The 5.9 per cent EBIT margin therefore compares very favourable with the analysts’ 0.6 per cent forecast. Furthermore, this positive surprise appears to be split 50 per cent between the Auto and Rubber groups, where sales in the Chassis & Safety division and “strong winter tyre sell-in won the quarter.” However, the analysts also warn that while the company has obviously benefited from “early winter tyre sell-in…this cannot be extrapolated into the third quarter where we think profit will certainly be lower.” The Morgan Stanley report once again gave veiled support for a combination with Schaeffler that sees Continental AG in the drivers seat. Their vision of a successful combination of the two companies is a merger that will: “improve Conti’s financial strength and independence” and include “a long-term framework for its involvement with…(Schaeffler) from both a strategic, financial and ownership perspective.”