Sonaecom: Return to the mean
We update our numbers post FY17 results and our FV falls from €2.2 to €2.0, mostly reflecting the drop in NOS’ share price. We upgrade the shares from Sell to NEUTRAL as the discount to NAV is back to more normalized levels as the shares have pulled back considerably in recent months. Operationally and from a corporate structure perspective, little has changed at Sonaecom (SNC) and we continue to believe that investors should favour direct exposure to NOS owing to several factors: 1) The dividend gap between what SNC pays vs what it receives keeps widening and is thus less appealing to SNC shareholders; 2) the liquidity of the shares remains limited; 3) the capital structure continues to be highly inefficient and there is no expectation of a short-term change in that stance from the controlling shareholder Sonae; and 4) the limited free float provides little incentive for Sonae to give more visibility on the IT unit, which we believe could have some hidden value.Nos SGPS is a holding company which is based in Portugal. Through its subsidiaries, Co. operates as a provider of telecommunications and media services. Co.'s subsidiaries main activities are data transmission, cable and satellite television, and internet services.
Sonae.com is a media and telecommunications group based in Portugal. Co. offers a range of mobile and wired communications services to residential and corporate customers in Portugal, including voice, data, television (TV) and roaming services, as well as wholesale services to third parties. Co.'s operations are organized along two main business units: Optimus, which is an integrated telecommunications operator, and the unit of Software and Systems Information Services (SSI). Additionally, Co. is active in the Online & Media sector, which includes the daily newspaper Publico and the online auction Website Miau.pt.
Haitong is the first international Chinese investment bank and our goal is to be the primary channel for capital flows into and out of China. During 2015 the Senior Management Team in London was expanded significantly to focus on this objective and to provide a full-service cross-asset markets business coupled with sector-focused investment banking. We work closely with our world-wide network of offices to bring a true depth of understanding to all client situations.
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