ENXTPA:ML

Stock Analysis Report

Compagnie Générale des Établissements Michelin

Executive Summary

Compagnie Générale des Établissements Michelin manufactures, distributes, and sells tires worldwide.

Rewards

PE ratio (12.4x) is below the French market (18.1x)

Earnings are forecast to grow 9.14% per year

Pays a high and reliable dividend of 3.34%

Risk Analysis

Has a high level of debt



Snowflake Analysis

Established dividend payer with adequate balance sheet.


Similar Companies

Share Price & News

How has Compagnie Générale des Établissements Michelin's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ML has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-3.0%

ML

-3.9%

FR Auto Components

-1.4%

FR Market


1 Year Return

12.0%

ML

6.6%

FR Auto Components

21.1%

FR Market

Return vs Industry: ML exceeded the French Auto Components industry which returned 10.5% over the past year.

Return vs Market: ML underperformed the French Market which returned 24.9% over the past year.


Shareholder returns

MLIndustryMarket
7 Day-3.0%-3.9%-1.4%
30 Day-2.3%-5.3%0.5%
90 Day-0.6%-4.7%5.9%
1 Year15.9%12.0%10.5%6.6%25.3%21.1%
3 Year15.1%4.9%-9.9%-17.1%43.2%29.5%
5 Year42.9%23.0%18.4%4.3%63.1%39.5%

Price Volatility Vs. Market

How volatile is Compagnie Générale des Établissements Michelin's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Compagnie Générale des Établissements Michelin undervalued compared to its fair value and its price relative to the market?

11.91x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ML (€110.9) is trading above our estimate of fair value (€96.33)

Significantly Below Fair Value: ML is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: ML is poor value based on its PE Ratio (12.4x) compared to the Auto Components industry average (9.1x).

PE vs Market: ML is good value based on its PE Ratio (12.4x) compared to the French market (18.1x).


Price to Earnings Growth Ratio

PEG Ratio: ML is poor value based on its PEG Ratio (1.4x)


Price to Book Ratio

PB vs Industry: ML is overvalued based on its PB Ratio (1.6x) compared to the FR Auto Components industry average (1.6x).


Next Steps

Future Growth

How is Compagnie Générale des Établissements Michelin forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

8.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ML's forecast earnings growth (9.1% per year) is above the savings rate (-0.1%).

Earnings vs Market: ML's earnings (9.1% per year) are forecast to grow slower than the French market (11.7% per year).

High Growth Earnings: ML's earnings are forecast to grow, but not significantly.

Revenue vs Market: ML's revenue (1.1% per year) is forecast to grow slower than the French market (4.7% per year).

High Growth Revenue: ML's revenue (1.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ML's Return on Equity is forecast to be low in 3 years time (13.4%).


Next Steps

Past Performance

How has Compagnie Générale des Établissements Michelin performed over the past 5 years?

10.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ML has high quality earnings.

Growing Profit Margin: ML's current net profit margins (6.9%) are lower than last year (8.1%).


Past Earnings Growth Analysis

Earnings Trend: ML's earnings have grown by 10.7% per year over the past 5 years.

Accelerating Growth: ML's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: ML had negative earnings growth (-8.3%) over the past year, making it difficult to compare to the Auto Components industry average (-8.3%).


Return on Equity

High ROE: ML's Return on Equity (13%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Compagnie Générale des Établissements Michelin's financial position?


Financial Position Analysis

Short Term Liabilities: ML's short term assets (€12.1B) exceed its short term liabilities (€8.3B).

Long Term Liabilities: ML's short term assets (€12.1B) exceed its long term liabilities (€11.6B).


Debt to Equity History and Analysis

Debt Level: ML's debt to equity ratio (59.6%) is considered high.

Reducing Debt: ML's debt to equity ratio has increased from 23.1% to 59.6% over the past 5 years.

Debt Coverage: ML's debt is well covered by operating cash flow (38.2%).

Interest Coverage: ML's interest payments on its debt are well covered by EBIT (10.2x coverage).


Balance Sheet

Inventory Level: ML has a high level of physical assets or inventory.

Debt Coverage by Assets: ML's debt is covered by short term assets (assets are 1.6x debt).


Next Steps

Dividend

What is Compagnie Générale des Établissements Michelin's current dividend yield, its reliability and sustainability?

3.47%

Current Dividend Yield


Dividend Yield vs Market

company3.5%marketbottom25%1.5%markettop25%4.5%industryaverage3.4%forecastin3Years4.0%

Current dividend yield vs market & industry

Notable Dividend: ML's dividend (3.34%) is higher than the bottom 25% of dividend payers in the French market (1.46%).

High Dividend: ML's dividend (3.34%) is low compared to the top 25% of dividend payers in the French market (4.43%).


Stability and Growth of Payments

Stable Dividend: ML's dividends per share have been stable in the past 10 years.

Growing Dividend: ML's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (41.3%), ML's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ML's dividends in 3 years are forecast to be well covered by earnings (36.6% payout ratio).


Next Steps

Management

What is the CEO of Compagnie Générale des Établissements Michelin's salary, the management and board of directors tenure and is there insider trading?

2.3yrs

Average management tenure


CEO

Florent Menegaux (57yo)

0.7yrs

Tenure

€1,228,543

Compensation

Mr. Florent Menegaux serves as a Chief Executive Officer at Compagnie Générale des Établissements Michelin since May 15, 2019. He served as a General Managing Partner of Compagnie Générale des Établissemen ...


CEO Compensation Analysis

Compensation vs Market: Florent's total compensation ($USD1.37M) is below average for companies of similar size in the French market ($USD3.59M).

Compensation vs Earnings: Insufficient data to compare Florent's compensation with company performance.


Management Age and Tenure

2.3yrs

Average Tenure

57yo

Average Age

Experienced Management: ML's management team is considered experienced (2.3 years average tenure).


Board Age and Tenure

6.1yrs

Average Tenure

61yo

Average Age

Experienced Board: ML's board of directors are considered experienced (6.1 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Jean-Christophe Guérin

    Executive Vice President of Manufacturing

    • Tenure: 8.5yrs
  • Florent Menegaux (57yo)

    Chief Executive Officer

    • Tenure: 0.7yrs
    • Compensation: €1.23m
  • Adeline Challon-Kemoun (52yo)

    Executive Vice President of Brands

    • Tenure: 1.8yrs
  • Yves Chapot (57yo)

    Managing Partner

    • Tenure: 0.5yrs
    • Compensation: €640.92k
  • Serge Lafon

    EVP of Specialties Segment

    • Tenure: 8.3yrs
  • Sonia Artinian-Fredou (53yo)

    Executive Vice-President of Services & Solutions

    • Tenure: 2.8yrs
  • Kamran Vossugi

    Head of East-European Geographical Area and General Director of Production for Tires

    • Tenure: 3.2yrs
  • Valérie Magloire (61yo)

    Head of Investor Relations

    • Jean-Claude Pats

      Executive Vice President of Personnel

      • Tenure: 0.8yrs
    • Benoit Balmary

      Group General Counsel


      Board Members

      • Barbara Dalibard (61yo)

        Lead Independent Member of the Supervisory Board

        • Tenure: 11.7yrs
        • Compensation: €65.00k
      • Jean-Pierre Duprieu (67yo)

        Independent Member of Supervisory Board

        • Tenure: 6.6yrs
        • Compensation: €52.00k
      • Olivier Bazil (73yo)

        Independent Member of Supervisory Board

        • Tenure: 6.7yrs
        • Compensation: €65.00k
      • Monique Leroux (65yo)

        Independent Member of Supervisory Board

        • Tenure: 4.3yrs
        • Compensation: €60.00k
      • Michel Rollier (75yo)

        Chairman of the Supervisory Board

        • Compensation: €90.00k
      • Thierry Le Hénaff (56yo)

        Independent Member of Supervisory Board

        • Tenure: 1.7yrs
      • Aruna Jayanthi (57yo)

        Independent Member of Supervisory Board

        • Tenure: 4.7yrs
        • Compensation: €44.14k
      • Anne-Sophie de La Bigne (59yo)

        Independent Member of Supervisory Board

        • Tenure: 6.7yrs
        • Compensation: €58.33k
      • Cyrille Poughon (44yo)

        Non-Independent Non-Executive Member of Supervisory Board

        • Tenure: 5.7yrs
        • Compensation: €45.00k

      Company Information

      Compagnie Générale des Établissements Michelin's company bio, employee growth, exchange listings and data sources


      Key Information

      • Name: Compagnie Générale des Établissements Michelin
      • Ticker: ML
      • Exchange: ENXTPA
      • Founded: 1863
      • Industry: Tires and Rubber
      • Sector: Automobiles
      • Market Cap: €19.058b
      • Shares outstanding: 178.61m
      • Website: https://www.michelin.com

      Number of Employees


      Location

      • Compagnie Générale des Établissements Michelin
      • 23, place des Carmes
      • Clermont-Ferrand
      • Auvergne
      • 63000
      • France

      Listings

      TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
      MGDD.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
      MLENXTPA (Euronext Paris)YesOrdinary SharesFREURJan 1992
      0OFMLSE (London Stock Exchange)YesOrdinary SharesGBEURJan 1992
      MCHDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
      MLPBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBEURJan 1992
      MLSWX (SIX Swiss Exchange)YesOrdinary SharesCHCHFJan 1992
      MICP-UETLX (Eurotlx)YesOrdinary SharesITEURJan 1992
      ML NBMV (Bolsa Mexicana de Valores)YesOrdinary SharesMXMXNJan 1992
      MGDD.YOTCPK (Pink Sheets LLC)UNSPONSORD ADRUSUSDOct 2008
      MLNVENXTPA (Euronext Paris)EUR2 (RFD 01/01/2020)FREURJan 2020

      Biography

      Compagnie Générale des Établissements Michelin manufactures, distributes, and sells tires worldwide. It operates through three segments: Automotive and Related Distribution, Road Transportation and Related Distribution, and Specialty Businesses and Related Distribution. The company offers tires for cars, motorcycles, scooters, trucks, agricultural, and construction equipment, as well as bikes, freight transport, public transit, trucking, civil engineering, and aviation. It is also involved in the provision of tire-related services, including design, development, and fine-tuning of mobility solutions for fleet managers; mobility services, such as road maps, mobile apps, itineraries, and travel guides; lifestyle products comprising car and bike accessories, shoe soles, and sports and leisure gears; and high-tech materials that include 3D printing, chemical and specialty, rubber, biosourced, recycled, and hydrogen materials. The company was formerly known as Manufacture de Caoutchouc Michelin and changed its name to Compagnie Générale des Établissements Michelin in October 1951. Compagnie Générale des Établissements Michelin was founded in 1863 and is based in Clermont-Ferrand, France. 


      Company Analysis and Financial Data Status

      All financial data provided by Standard & Poor's Capital IQ.
      DataLast Updated (UTC time)
      Company Analysis2020/01/24 20:56
      End of Day Share Price2020/01/24 00:00
      Earnings2019/06/30
      Annual Earnings2018/12/31


      Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.