DCF Studio

    CON.DE · GER · Consumer Cyclical

    Continental Aktiengesellschaft

    Also onConsensus Drift

    Implied value per share

    EUR 18.73

    Market price

    EUR 67.56

    Implied upside

    -72.3%

    5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case

    Wrong toolThis line has no market capitalisation, which means it is not ordinary shares - typically a hybrid, preference line, note or unlisted stub. A discounted cashflow values a claim on the whole business, so applying it here attributes all of the group’s revenue to a security that has no such claim. Its value is its coupon and call schedule. Look up the ordinary line instead.
    NoteRisk-free rate is an assumption: EUR assumption - no free live source available for this market.

    No usable EV/EBITDA (EBITDA is not positive), so the exit multiple falls back to 8x.

    Value Per Share

    Perpetuity growth
    EUR 18.73-72.3%
    Exit multiple
    EUR 6.69-90.1%
    Market price
    EUR 67.56

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (EUR). Outflows negative.

    0m314m628mFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayEUR
    LineFY26FY27FY28FY29FY30CAGR
    RevenueEUR 15.6bnEUR 12.4bnEUR 9.8bnEUR 7.8bnEUR 6.2bn-20.7%
    EBITEUR 740.3mEUR 587.3mEUR 465.9mEUR 369.6mEUR 293.2m-20.7%
    NOPATEUR 546.3mEUR 433.4mEUR 343.8mEUR 272.8mEUR 216.4m-20.7%
    Add depreciation & amortisationEUR 1.1bnEUR 835.1mEUR 662.5mEUR 525.6mEUR 417.0m-20.7%
    Less capital expenditureEUR -835.0mEUR -662.5mEUR -525.5mEUR -416.9mEUR -330.8m-20.7%
    Less increase in working capitalEUR -135.8mEUR -107.8mEUR -85.5mEUR -67.8mEUR -53.8m-20.7%
    Free cashflow to firmEUR 628.1mEUR 498.3mEUR 395.3mEUR 313.6mEUR 248.8m-20.7%
    Discount factor0.98150.94560.91090.87750.8454-
    Present valueEUR 616.5mEUR 471.2mEUR 360.1mEUR 275.2mEUR 210.3m-23.6%
    Present Value Of The ForecastEUR 1.9bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate2.60%EUR assumption - no free live source available for this market (assumption)
    Equity risk premium6.00%Market assumption
    Beta1.215Reported 1.321, pulled toward 1.0 (Blume)
    Cost of equity9.89%Risk-free + beta x equity risk premium
    Cost of debt5.15%Interest expense / average total debt
    Market capitalisationEUR 0.000.0% of capital
    Total debtEUR 6.8bn100.0% of capital, book value as a proxy
    Tax rate26.2%Effective, capped at statutory
    WACC3.80%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareEUR 18.73

    79% of EV

    Forecast FCFF, final year
    EUR 248.8m
    Capex at depreciation, working capital in reinvestment
    EUR 222.4m
    Less reinvestment at g/ROIC (51.2% of NOPAT)
    EUR -114.0m
    Capitalised
    EUR 108.4m
    ROIC (reported)
    4.9%
    Terminal value, undiscounted
    EUR 8.5bn
    Terminal value, discounted
    EUR 7.2bn
    Enterprise value
    EUR 9.1bn
    Less net debt
    EUR 5.4bn
    Equity value
    EUR 3.7bn

    Exit at 8.0x EBITDA

    Value per shareEUR 6.69

    71% of EV

    Terminal value, undiscounted
    EUR 5.7bn
    Terminal value, discounted
    EUR 4.8bn
    Enterprise value
    EUR 6.7bn
    Less net debt
    EUR 5.4bn
    Equity value
    EUR 1.3bn

    Spread between methods: 95%.

    Sensitivity

    Value per share (EUR) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    1.80%221.36————
    2.80%35.8456.48144.99——
    3.80%11.3714.0618.7329.1273.50
    4.80%1.661.832.032.302.70
    5.80%-2.59-2.52-2.44-2.37-2.29

    Outlined: this model. Green text: above today's price of 67.56. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputModelImpliedGap
    Revenue growth, every year-20.7%-7.5%+13.2pp
    EBIT margin4.7%10.1%+5.3pp
    Discount rate3.8%3.1%-0.7pp
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.