Buy
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Original-Research: Delticom AG - from Quirin Privatbank Kapitalmarktgeschäft
Classification of Quirin Privatbank Kapitalmarktgeschäft to Delticom AG
Good start into FY 2025 Delticom AG remained focused on profitable growth during Q1 2025 with revenues growth of 9.0% yoy. This positive development is also reflected in the overall market environment: According to the European Tyre and Rubber Manufacturers’ Association (ETRMA), the upward trend in the consumer tyre segment (+3% yoy), already observed in the second half of 2024 (+8% yoy), continued in the first quarter of 2025. Volumes nearly returned to the levels of Q1 2019 – before the onset of the pandemic. TTM sales fell by EUR 4m to EUR 490 million and were therefore 1% lower than TTM sales in the same period of the previous year, but the strong Q4 2023 must be taken into account, so the current TTM development can be seen as positive. Q1 2025 Group EBITDA was also significantly higher year-on-year at EUR 1.5m (Q1 2024: EUR 0.7m), resulting in a TTM EBITDA of EUR 21.1m (4% lower than TTM EBITDA in the same period last year). If you look at the TTM figures at sales and EBITDA level, the company's 2025 forecast (Sales EUR 470-490m; operating EBITDA EUR 19-21m; Quirin estimates: EUR 472m and EUR 19.3m, respectively) can be considered realistic, as the uncertainties surrounding the end markets are difficult to predict. The European replacement tyre market remains dramatically underestimated in terms of size and future growth potential, which positions the company to benefit from long-term tailwinds. Applying our ROE/COE valuation approach, we derive a new fair value of 4.20 (4.10), therefore we confirm our BUY rating. The outstanding dividend payment of EUR 0.12 per share, which represents an attractive dividend yield of ~4.8%, and the ongoing share buy-back currently provides downside risk protection. You can download the research here: http://www.more-ir.de/d/32662.pdf For additional information visit our website: https://research.quirinprivatbank.de/ Contact for questions: Quirin Privatbank AG Institutionelles Research Schillerstraße 20 60313 Frankfurt am Main research@quirinprivatbank.de https://research.quirinprivatbank.de/
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2140704 19.05.2025 CET/CEST
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