Increasingly fizzy
Following a strong end to 2017 and in the light of a positive outlook for 2018, we have upgraded the stock to Hold as 2018 profitability appears fairly insulated from input cost and FX fluctuations. We also expect this year to be one of re-leveraging for CCHBC, either as a result of corporate activity or as a result of cash returns. We contend that a transformational deal could justify higher valuation but the distribution of a special dividend that would take CCHBC towards the low-end of its targeted leverage (leaving headroom for bolt-on acquisitions) is already reflected in the share price.
We continue to argue that the expectation bar for the medium-term has been set quite high, taking into account CCHBC’s geographic profile, but the short-term releveraging potential and the visibility on 2018 numbers are likely to provide valuation support on a 12-month basis.
Coca-Cola Hellenic Bottling Co. produces, sells and distributes an extensive portfolio of non-alcoholic ready-to-drink beverages. Co.'s business is engaged in producing, selling and distributing non-alcoholic ready-to-drink beverages under bottlers' agreements with The Coca-Cola Company. In some Territories, Co. also produces, sells, distributes and markets its own brands of juice and Water beverages. In addition, Co. bottles and distributes beer in Bulgaria and Former Yugoslav Republic of Macedonia and Co. distributes a selected number of third party premium spirit brands in certain central and eastern European operations.
Eurobank Equities is a Greek-based firm offering research, sales and trading services to institutional, corporate and private clients. The company is wholly owned by Eurobank, one of the 4 systemic banks in Greece.
Research is the backbone of Eurobank Equities' platform, with a team of 4 professionals committed to generating actionable investment ideas by providing timely research products. We are committed to offering value-added services to clients by filtering market noise and providing insights on the multiple sectors that we cover. Our universe includes 26 - large, medium and small cap - companies whose market capitalization amounts to 80-85% of the total market capitalization of the Athens Stock Exchange. Our research team also maintains the capacity to generate ad-hoc research for micro-cap listed companies.
Our team has consistently gained recognition among institutional investors for its quality research, having ranked No. 1 team in Greece at the Extel Surveys of 2013-2016 and 2018. We have also been named Leading Brokerage Firm in Greece over 2014-2016 and in 2018.
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