TECHNICOLOR BUY | EUR3.8 VS. EUR4.4 Hidden value potential confirmed following CMD
In this report we are updating our valution for both TCS and Vantiva (ex-TCS) activities in light of the details provided during last week’s CMD. In particuar, we welcome the greater transparency on cash items at both businesses, which enable us to secure our forecasts and DCFs. We still believe TCS offers attractive growth opportunities, but cash flow should fall behind our initial expectations. On the other hand, Vantiva’s business might prove more attractive that the consensus currently believes, but cash generation is still expected under pressure in the coming years. Our TP is down to EUR3.8 vs EUR4.4 previously, still pointing to significant upside: we estimate hidden value is still important at Technicolor, which the spin off should help externalise. We confirm our Buy recommandation.
Since 1996, Bryan, Garnier & Co has been growing with an absolute conviction that the investment banking landscape would experience a major revolution: most of the large local generalist banking groups will disappear to the benefit of a handful of global powerhouses, and an emerging group of independent, highly specialised boutique investment banks.
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