Investor Channel is the communication channel between Pirelli and the financial community. Analysts, shareholders and web users can use the channel for direct dialogue with the Group. The blog is moderated by Pirelli Investor Relations.

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The main European stock markets retreated slightly in the week from the 30th of September to the 4th of October, 2013 (London -0.9%, Frankfurt -0.4%, Paris -0.5%). Trading was negatively affected by the ongoing “shutdown” of the US federal government: while representatives try to find an agreement on federal budget and debt ceiling, approximately 800,000 public sector workers will be on unpaid leave and several services will not be operational. According to the President of the San Francisco Fed, a 2-week long “shutdown” will cost 0.25% of GDP growth in the current quarter.
The Milan stock exchange outperformed (FTSEMIB +3.7%) thanks to the positive outcome of the confidence vote which confirmed the current government.

Auto & Parts stocks traded in line with overall equity markets (sector index -1.2%, European Blue Chips Stoxx 600 index -0.7%). Automakers with the highest European exposure outperformed during the week, following reassuring vehicle sales data for the month of September: the biggest 5 markets posted a combined 5.9% yearly increase (Germany, UK, France, Italy and Spain). Tyre stocks were down instead, with commentary from Nokian and Michelin pointing to lower expectations, respectively, for the Russian tyre market in the remainder of 2013 and for the mining tyre market for 2014 and 2015.

Pirelli shares closed the week at 9.67€ (-1.9%) with an average daily volume of 2.1 million shares.
Two equity reports were published today; according to Mediobanca (upgrade to Outperform, TP +3.2€ at 12€) Pirelli’s strategy for the following 5 years will include an increased focus on the Premium segment as well as greater efforts on cost reduction and improved cash flow management; broker Bank of America upped the stock’s valuation as well (Buy, TP +1.1€ at 11.8€), mainly thanks to improved sector multiples (Ev/Ebitda from 5.4x to 5.6x). Consensus Taget Price stands at 10.3€ with 82% of analysts recommending to Hold or Buy Pirelli shares.

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