Acciona: A quality story but largely under looked
We see Acciona as a quality stock that has been under looked in the last twelve months (–9% relative to Ibex 35). A reorganization of its portfolio of activities is beginning to show results and we expect that the market will revisit this story as divestments materialize in 1Q18e, debt is cut and the risk profile improves.
Some negatives explain the recent underperformance
- Generation
- Nordex
Focus on the positives: infrastructure, energy, divestments and deleveraging are ahead
- Infrastructure (construction, water, services) is taking off strongly
- Energy and concessions
- Divestments: Trasmediterránea and the motorway R 160
- Real estate
- Deleverage
- Undemanding valuation
We recommend to Buy with a Dec-2018 target price of €87.45 (from €88.60).
Acciona is the parent company of a construction group. Co. is engaged in general construction activities in the areas of civil engineering and buildings, including railways, marine and hydraulic works, motorways and airports, town planning, conduits, pavements, parking lots, and industrial and urban buildings. In addition, Co. is engaged in the provision of real estate services, the operation of parking lots, telecommunications, services, ecology and alternative means of energy. Co.'s operations are organized in six business divisions: Infrastructures, Real Estate, Energy, Water, Environmental & Urban Services and Logistic & Transport Services.
Bankinter S.A. is a Spanish brokerage firm established in 1989. The company's line of business includes the provision of market research and trading services for Equity and Fixed Income products.
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