Mediaset España: There's a price for everything
While challenges remain in the sector due to competition from Pay-Tv and OTT platforms, we believe that these risks are more than priced into Mediaset España shares. The shares’ depressed performance (YTD -11% vs IBEX35) has in our view been exacerbated by expectations of a weak advertising market in Q1; something one cannot say is completely unexpected due to the Easter effect. However, we expect this effect to reverse in April, thus not endangering our FY18E expectation of 2% TV ad market growth. Furthermore MSE is poised to benefit directly from the effect of the football World Cup in June/July with the company broadcasting the competition exclusively, supporting market share expectations during Q2 and Q3. Our 2018E/19E revenue/EBITDA numbers move up slightly and our FV rises from €9.6 to €9.7, giving 20% upside that leads us to upgrade the shares from Neutral to BUY. We think the shares correction brought them to a level where the fundamental strengths of the company, like its flexible OPEX structure and robust cash flow conversion rate (87% of 2018E EBITDA into FCFE), more than outweigh the sector’s woes.Gestevision Telecinco is a television network company based in Spain. Co. heads a group of dependent companies, which form the Telecinco Group. Through its subsidiaries, Co. is engaged in the management and commercial exploitation of a television network. Co.'s television network acquires, produces, and distributes audiovisual content. Co. also sells the network advertising airtime, carried out by its subsidiary. In addition, Co. is involved in the sale of other advertising products; production of news programs; the production and sale of audiovisual property rights; and teleshopping.
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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