Michelin's Profit Warning Prompts AlphaValue/Baader Europe to Update Rating, Forecasts

02:19 AM EST, 12/10/2025 (MT Newswires) -- AlphaValue/Baader Europe adjusted Michelin's (ML.PA) rating to add from buy, with a price target of 32.9 euros, amid reduced near-term earnings expectations following the tire manufacturer's latest profit warning. On Wednesday, the research firm's EPS forecast for full-year 2025 was cut by 8.57% to 2.47 euros, while the estimate for 2026 was slashed 12.8% to 2.84 euros. Analysts also nudged their 2025 sales estimate lower by 0.8% to 25.88 billion euros on expectations of a "weaker performance" across all of Michelin's divisions. AlphaValue/Baader Europe also expects the softness to carry over into the first six months of 2026 as the current weakness in the truck and specialty units is anticipated to continue, with recovery assumed in the remaining half of the year. As such, sales projections for 2026 are down 1.5% to 26.6 billion euros. "Given the lack of near-term visibility until H2 2026, it remains challenging for investors to take more aggressive positions. Nevertheless, Michelin remains an attractive story, with potential for margins to rise above historical levels in 2027-28 as the product mix improves, the specialty and truck segments recover, and restructuring measures begin to show results. Momentum should further benefit from stabilising raw material costs, a gradual pickup in volumes, and early signs of recovery in agricultural and truck markets," the note said.