On Monday, Pirelli & Co (PIRC:IM) (OTC: PLLIF) shares received an upgrade from Hold to Buy by Kepler Cheuvreux, with the price target remaining at EUR6.25. The upgrade follows what the firm identifies as a conservative start to the year, despite Pirelli shares underperforming compared to Michelin (EPA:MICP) and other tyre manufacturers.
The analyst from Kepler Cheuvreux pointed to the company's Industrial Plan, introduced in early March, noting that the targets outlined appear relatively conservative. This assessment suggests that the firm sees room for Pirelli's performance to exceed its current projections.
The recent transaction involving Brembo's 5.58% stake, sold on October 1 at EUR5.07, is also highlighted as a factor contributing to the upgrade. The sale has increased liquidity, with Camfin acquiring 2.5% of the stake, and is perceived as creating an attractive entry point for investors.
Kepler Cheuvreux's unchanged price target of EUR6.25 for Pirelli & Co reflects the firm's expectations for the stock's potential upside. The analyst's comments underscore a positive outlook for Pirelli, suggesting that the current share price may offer an opportunity for investment.
The upgrade of Pirelli to a Buy rating comes at a time when the company's shares have shown underperformance relative to peers in the sector. The firm's analysis indicates a belief in the potential for Pirelli's value to grow, supported by recent strategic movements and market dynamics.
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