2016 in-line at operating level, heavy provisioning elsewhere
Acciona’s 2016 results were in-line with our estimates at the operating level (sales were 5% above our estimate and EBITDA was 2% up).
We saw better than expected growth in construction and shipping, while the other activities performed as expected. Heavy provisioning (financial restructuring and some operational) eroded the gains from the AWP disposal by more than we had estimated.Since the beginning of 2017 the shares have tracked the evolution of the electricity pool prices.
The recent weakness in electricity pricing is likely to continue to undermine Acciona’s performance in the near term.
Our Buy recommendation and target price of €88.30 are unchanged.
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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