We upgrade Norilsk Nickel to an out-of-consensus BUY, increasing our target price to $20/GDR. Norilsk’s shares have lagged the metals basket by 20% and we expect them to rerate when the street starts raising earnings forecasts to factor in the soaring metal prices. Strong data on demand and inventories suggest that positive momentum for the name continues to build, on China’s economic growth outlook and environmental crackdown, and the weak USD. The high-dividend story remains intact with the full year yield exceeding 9.0%, on our estimates, and our expectation being a $1.1/GDR final dividend, yielding 6.8%, as we forecast FY17 EBITDA of $4.1bn (vs $4.0bn consensus). On MtM Norilsk trades at 6.0x FY18E EV/EBITDA vs its own 5Y average of 6.6x, and global copper/nickel producers’ average of 7.1x.
Since its inception in 1991, ATON has built a reputation for combining in-depth local knowledge of the Russian market with the highest international standards in research, sales and trade execution. As a result, we have been able to attract many of the leading domestic and international institutional fund management groups as our clients. As one of the leading independent investment banks in Russia, we offer the full range of institutional brokerage service, including:
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.