Per Citi’s report:
« We see value in Elior following the recent de-rating. We trim FY18-20E EBITDA forecasts 2-3%, but EPS falls c10% to reflect higher D&A guidance. The contract and concession catering industries are in structural growth and the European macro backdrop is supportive. Given expectations have been rebased, we now see upside risk to margin forecasts over time. The stock trades at over a 30% EV/EBITDA discount to peers, which offers an attractive entry point. »
No indication of fair value estimate so far.
Per today’s report:
« Floated in early 2017, Neinor is the second largest Spanish homebuilder, focusing on first time buyers in the medium to medium-high price range. The group will ramp up production on its E1.5bn (12k unit) landbank bought early in the cycle on 20% EBIT margin and 15% ROCE. However we expect Neinor to complete future land acquisitions at 15% EBIT margin. DBe a 10% 2020 FCF/sales at steady-state which, based on a 100% pay-out, drives a 2021 div yield of 11%. Neinor may choose to funnel cash back into the land bank to drive further earnings growth above mgmt and consensus run-rate forecasts. Trading on 1.3x 2020 P/NTAV, we believe this yield/growth opportunity leveraged to the early stages of recovery in the Spanish housing market, remains underestimated and initiate with a BUY. »
Exane has decided it was time to take profits on Marine Harvest, downgrading the stock to Neutral with a target price of NOK140.
Per today’s report:
« While our positive stance on the medium-term upward trajectory of the global salmon price (and hence major salmon producers’ profitability) remains unchanged, we are mindful that Marine Harvest is a commodity play. We have reduced our estimates to reflect our new salmon price assumptions. Keeping in mind that downward consensus revisions are likely already somewhat priced in, we downgrade to Neutral. »
Says: « No longer the King. » Per JPMorgan’s morning note: « For over a decade ABI has been a beacon of high growth across European Beverages. ABI used attractive financing to consolidate the global beer industry. This historically led to superior pricing power, which combined with superior execution and cost cutting, resulted in well above-average profit growth. We believe the era of above-average growth for ABI is now behind us. The market is too optimistic, in our view, about the turnaround in Brazil as well as the ability of ABI’s Global Brands ex. domestic markets to offset ongoing challenges in the US. We expect underperformance in the US, which may have FCF repercussions, to weigh on group profit until at least FY20E. On our estimates, ABI trades on a CY18E P/E of 23.4x; marking a still material premium to the European Beverages sector ex ABI at 21x, despite in-line underlying growth and ongoing challenges. We downgrade ABI to Underweight with recent underperformance likely to persist. We see better growth opportunities in Diageo (CY18E P/E 20.9x). »
The broker also published a report on European beverages, where it writes Diageo is one of its favorite picks in the sector, along with CCH.
Hammerson announced a recommended offer for Intu Properties, the exact same day Exane BNP Paribas’s Michael Burt says « Hammerson is the most obvious acquirer for Intu » in a report date Dec 6 (at 6:18am), yet adding M&A is not an option. Continuer la lecture de « Exane Issues Undeperform Note on Intu Properties But Says Hammerson Could Buy It… The Day the Deal is Announced »
Here are 3 slides from the latest « Where to Invest Now » published by Goldman Sachs’s David J Kostin and team. There sum up his views on US equity market going into 2018 and the most interesting one is the following, because it helps understand what an « exuberant » market would look like, if history was to repeat itself.
Continuer la lecture de « What Irrational Exuberance Might Look Like… »