Orano : New projects to shape the future

After a long period of deleveraging, which has led to a very solid financial structure (leverage of 0.4x at the end of 2024), Orano will pursue a more dynamic investment policy over the period 2025-2027, which will temporarily weigh on credit ratios. To reflect this development, we have revised our outlook from stable to negative but we remain confident in the group's ability to maintain its current BBB- rating.
We are maintaining our Buy recommendation on the short-maturity bonds 23/04/26 and 15/05/27 because liquidity is comfortable (as is access to the bond market for future refinancings). In addition, they offer a yield premium compared to the average of BBB- issuers with comparable maturities. On the other hand, we downgrade our recommendation from Buy to Neutral on bonds with longer maturities 08/03/28 and 12/03/31 as they appear a little expensive to us from a relative point of view.
However, in the current context of the trade war orchestrated by D. Trump, Orano has an interesting profile, protected both by the atypical nature of its activities, the current buoyant context of the nuclear market, and by the fact that the French State is its main shareholder with 90.33% of the capital (with significant financial support, if needed). These factors could justify a trade-off in favour of all Orano bonds, even if the yields are a little less attractive for the longest maturities.