Remodelling towards petrochemicals
We roll over our TP from EUR 39.7 to EUR 42.3. Our new TP leaves an 8% upside
potential from the current share price, further increased by a 4.7% DIVY based on
announced DIVPS of EUR 1.85 for 2020. As evidence shows, OMV proved that it has
been good not only at streamlining its operation and but also at remodelling of its
business model in recent years. Although we are still fond of OMV’s equity story, we
think the majority of good news (e.g. improving market conditions align with earnings
expectations) has already been reflected in terms of the current share price, therefore
we change our rating on OMV from BUY to Accumulate.
OMV is trading on an EV/EBITDA multiple, based on 2022 adjusted numbers, of 5.3x.
Yet its shares look reasonably valued, making holding them a risk well worth taking in
light of its increasing exposure in petrochemicals and a meaningful amount of dividends
likely to be paid going forward.
OMV is an international energy company with activities in Exploration and Production (E&P), Refining and Marketing including petrochemicals (R&M), and Gas and Power (G&P). Co. explores and develops oil and gas resources and supply energy to over 100 million people. OMV has three operating segments: Exploration and Production (E&P), Refining and Marketing, including petrochemicals (R&M), and Gas and Power (G&P), as well as the segment Corporate and Other (Co&O).
Concorde Securities Ltd. is Hungary’s leading independent company engaged in investment banking activities. It provides its clients with integrated financial services, including securities trading, research, corporate financing advisory, capital market transactions, wealth management and investment advisory. The operational management of the company is the responsibility of the CEO, while the owners/managers (who control one-third of the company through their shares and options) are in charge of its strategic governance. Concorde Securities Ltd. is a member of the Budapest, Frankfurt, Warsaw and Bucharest stock exchanges, as well as of the Hungarian Association of Investment Service Providers.
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