BGC Partners: PEGASUS Company Update - BUY Maintained with 35% upside
We revised up our TP by 74% from TL50.0 to TL86.8 parallel to stronger than expected 2Q19 performance, revised management guidance back in Jun-19 and further indications by the management that FY2019 figures might even exceed the revised guidance. The change in our target price is driven by: i) 26% and 14% upward revision in our 2019 and 2020 EBITDA estimates, respectively, ii) 7% downward revision in expected average net debt position with higher EBITDA generation. We continue to use a target EV/EBITDA multiple of 5.2x, applied on 2019E and 2020E average EBITDA figures. Our net profit estimate increased by 85% and 64% for 2019 and 2020, respectively, mainly due to higher EBITDA estimatesPegasus Hava Tasimaciligi is a low-cost airline group based in Turkey. Co. provides reasonably-priced transportation opportunities on point-to-point basis in short and medium range flight lines on its domestic and international network. Co. primarily provides transportation opportunities from its main hub in Istanbul Sabiha Gokcen International Airport, but also offers scheduled flights from other domestic hubs, primarily in Adana, Antalya and Izmir. Co.'s fleet is composed of 49 airplanes in total. Co.'s flight network consists of 76 locations (45 abroad and 31 domestic flight locations in 30 countries). Co. also provides cargo services and provides various training services.
BGC has been one of the major market players in Turkish OTC debt, FX and swaps markets since 1998.
We started offering corporate finance and investment banking services to our clients in 2013. We offer a complete range of financial services to help our clients achieve their goals. Our main areas of activity within investment banking are as follows:
- Mergers & Acquisitions
- Equity Capital Markets
- Debt Finance & Advisory
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