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 were mixed in the week from the 11th to the 15th of November, 2013 (Milan -1.4%, London -0.2%, Frankfurt +1%, Paris +0.7%, Madrid -0.5%) with the Stoxx 600 index closing at +0.1%. Negative news came out of Europe with GDP growth slowing down to +0.1% in Q3 (after the +0.3% reported in Q2), whereas comments from future Fed Chairman Janet Yellen suggested that tapering of monetary stimulus will happen very gradually.

Auto & Parts stocks were flat (sector index +0.4%). Broker CITI confirmed its positive view on the sector at the end of Q3 reporting season: investor focus is now on technological innovation to reduce emissions and on the impact of foreign exchange fluctuations, given the increasingly global reach of the industry. Despite the good sector performance ytd (+32%), auto stocks are still among the least expensive within Europe (9x 2014E P/E vs EU average of 13x).

Slight profit taking on Pirelli shares, which closed at 10.81€ (-2.2%) after the +8.3% of the two days following the presentation of the Industrial Plan. 5 brokers published an update report during the week, upgrading their estimates especially for what concerns cash generation; according to KeplerCheuvreux, Pirelli is starting a new phase of value creation after the high investments of recent years. Citi (+2.6€ at 11€), Deutsche Bank (+1.5€ at 11€), Banca Aletti (+1.5€ at 13.5€) and KeplerCheuvreux (+0.8€ at 11€) improved their valuation on the stock, whereas Bank of America Merril Lynch trimmed Pirelli’s target price to 11.6€ (from 11.8€).

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