Report
Research Department
EUR 100.00 For Business Accounts Only

IBERIAN DAILY 31 JULY (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ACS, ARCELOR MITTAL, CAF, CAIXABANK, FERROVIAL, GRUPO CATALANA OCCIDENTE, MEDIASET ESPAÑA, MELIÁ HOTELS, TALGO.

MARKETS YESTERDAY AND TODAY

Germany drags down Europe
The poor 2Q’20 GDP data in Germany, which could augur negative surprises in the periphery, led to profit taking in the rest of the European indices, with drops of more than -3%. In the Euro STOXX, almost all the sectors were in the red, led by Banks and Insurance, whereas Travel & Leisure rose (+1.3%; after the strong rise in Francaise des Jeux) and Food fell the least. On the macro side, in the euro zone the economic climate indicator improved more than expected thanks to the industrial component. In Germany the data was poor, with the 2Q’20 GDP falling -10.1% YoY vs. -9.0% expected, and July’s inflation fell into negative territory. By contrast, the number of unemployed on the month fell unexpectedly. In France, the 2Q’20 GDP provided a positive surprise, as well as the 1Q’20 revision. In Spain, July’s inflation fell into negative numbers (-0.6% vs. -0.3% expected and previous). In the US, the 2Q’20 GDP was somewhat better than expected due to the rise in public spending (record drop of -32.9% QoQ) and weekly jobless claims rose in line with expectations. D. Trump would have proposed the possibility of postponing the elections date, which seems complicated. In Japan, June’s preliminary industrial output improved slightly. In China, July’s manufacturing and services PMI were mixed (better the manufacturing and worse services). As for the virus, the number of cases continue to increase in most countries (123 in China, the highest number since March) and the UK would have imposed restrictions in the north of the country. In US business results, Apple, Alphabet (Google), Amazon, Apple, Alphabet (Google), Amazon, Facebook, Ford, Kraft Heinzbeat expectations.
What we expect for today
Slight gains where the good sentiment thanks to the results released by the technological giants would alleviate part of the negative bias in view of the growing outbreaks. Currently, S&P futures are up +0.12% (the S&P 500 was up +0.39% vs. its price at the closing bell in Europe). Volatility in the US rose (VIX 24.76%). Asian markets are mixed (Japan -2.4% and Hong Kong +0.25%).
Today in Spain and the euro zone we will learn the first readings of the 2Q’20 GDP, in Europe July’s inflation and in the US June’s personal income and outlays and 2Q’20 labour cost. In US business results, Caterpillar, VF, Merk & Corp, Colgate, Chevron and Exxon Mobil, among others, will release their earnings. In debt auctions: Italy (€ 7.25 Bn in 5Y and 10Y bonds as well as 5Y FRN).

COMPANY NEWS

FERROVIAL. 2Q’20 results in line on the operating level. BUY.
The 2Q’20 results were in line on the operating level thanks to the better performance in Toll Roads (80% of the T.P.; € 59 M of EBITDA vs. € 38 M consensus), which benefited from the quick recovery of the US assets, but with a larger impact from Covid-19 on Construction (2% of T.P.; € 7 M of EBITDA vs. € 12 M expected), despite recording activity levels that were around +50% higher. Cash ex-infra performed well, improving to € 1.69 Bn (vs. € 1.2 Bn BS(e)) thanks to the noteworthy working capital performance (€ -10 M vs. € -440 M in 1H’19) and with the liquidity position rising to €~7.51 Bn (2.6x NFD; vs. € 5.9 Bn in 1Q’20). We expect a positive slant in the reception, despite outperforming the IBEX by +2% since the pandemic hit.

CAIXABANK. Better 2Q’20 in Operating Profit but with higher Covid-19 provisions. BUY.
Net Profit totalled € 115 M, -15% below expectations (~ € 200 M BS(e) and consensus), due to Covid-19 provisions (€ 755 M in 2Q’20; CoR 127bps vs ~85bps BS(e) and consensus). The bank reiterated the 2020 guidance at the high end of the range (60-90bps and vs. 106bps in 1H’20) and we would expect lower provisions in the 2H’20. Better performance in Operating Profit (+22% vs. 1Q’20; +15% vs. expectations thanks to: (i) the strength of core revenues (NII and fee revenues), around +1% better than expected and (ii) the sharper drop in costs (-4% vs. 2Q’20 and vs. around -2% expected). The company raised its guidance in this regard, now forecasting a -2% drop’20. 12.3% CET1 (+30bps vs. 1Q’20) due to positive regulatory impact. We expect a mixed share price reaction.
Underlyings
Actividades de Construccion y Servicios SA

ACS Actividades de Construccion y Servicios is a holding company. Through its subsidiaries, Co.'s activities are divided into the following areas: Construction, engaged in the construction of civil works, and residential and non-residential building construction; industrial services, engaged in the development of applied engineering services, installations and the maintenance of industrial infrastructures in the energy, communications and control systems sectors; services, groups together environmental services, the outsourcing of building maintenance services, logistics and transport services; and concessions, mainly engaged in transport infrastructure concessions.

Amadeus IT Group SA Class A

Amadeus is a transaction processor for the global travel and tourism industry. Co. provides transaction processing power and technology solutions to both travel providers (including full service carriers and low-cost airlines, hotels, rail operators, cruise and ferry operators, car rental companies and tour operators) and travel agencies (both online and offline). Co. acts both as a worldwide network connecting travel providers and travel agencies through a processing platform for the distribution of travel products and services (through the Distribution business), and as a provider of a portfolio of IT solutions which automate certain business processes (through the IT solutions business).

ArcelorMittal

CaixaBank SA

Caixabank is an investment company based in Spain. Co. is involved in investment portfolio management activities across two areas: Services and Financial Business and Insurance. In the services area, Co. provides investment solutions for companies involved in the infrastructure, energy, services and entertainment sectors. In the financial business and insurance area, Co. is engaged in the investments for international banks, insurance and specialist financial services. Co. focuses most of its banking investments in India, China, the U.S., and Central and Eastern Europe with a particular interest in retail banking. Co. is also involved in the disinvestments activities.

Construcciones Y Auxiliar De Ferrocarriles, S.A.

Ferrovial S.A.

Ferrovial is a transportation company based in Spain. Co. is engaged in operations in the transportation sector. Co. specializes in the design, construction, management, administration and maintenance of transport infrastructures. Co.'s services range also includes the maintenance of parking lots, and land-, sea- and air-based transport networks. Co. is also engaged in the promotion and operation of short-stay parking lots, parking regulation and management services and promotion and sale of residents' parking.

Fluidra S.A.

Fluidra is engaged in the manufacture and commercialization of accessories and specific products for swimming pools, irrigation, and water treatment and purification systems.

Grupo Catalana Occidente S.A.

Grupo Catalana Occidente is an insurance group based in Spain. Co. is engaged in insurance and reinsurance activities, including commercial, life, disability, and automobile insurance. Co. is also engaged in the sale of annuities and pension funds. Co.'s operations are organized along two businesses: Traditional business (insurance) and Credit Insurance business. Co.'s main markets are located in Spain, Germany, United Kingdom, France and the Netherlands. Co. maintains a presence in more than 40 countries.

International Consolidated Airlines Group SA

International Airlines Group is an international scheduled airline and global premium airlines. Co.'s principal place of business is London with significant presence at Heathrow, Gatwick and London City airports.

Mediaset Espana Comunicacion SA

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.

Melia Hotels International S.A.

Melia Hotels International is the parent company of a group engaged in the acquisition, management and operation of hotels. Co. operates its hotel network in Germany, Argentina, Brazil, Bulgaria, Cabo Verde, Chile, China, Costa Rica, Croatia, Cuba, Egypt, Spain, United States, France, Greece, Netherlands, Indonesia, Italy, Luxembourg, Malaysia, Mexico, Panama, Peru, Portugal, Puerto Rico, United Kingdom, Dominican Republic, Singapore, Switzerland, Tunisia, Uruguay, Venezuela and Vietnam under the followings brandnames: Paradisus Resorts®, Melia Hotels & Resorts®, TRYP Hoteles® and Sol Hotels & Resorts®.

Prosegur Cash SA

Prosegur Cash SA, formerly Prosegur Cit Holding SA, is a Spain-based company engaged in the provision of security services. The Company's activities are divided into three business areas: Logistics, Cash management and Outsourcing. The Logistics division focuses on the provision of local and international transport services of cash and other valuable goods. The Cash management division offers counting, processing, custody, preparation and delivery of notes and coins, as well as replenishment of automatic teller machines (ATMs). The Outsourcing division includes a number of support financial services, such as automation of retail operations through self-service cash automatization machines (MAEs), ATMs management, as well as branch forecasting, reconciliation, settlement and credit card support services. The Company operates through own branches and joint ventures in Europe, Central and South America, Africa, Asia and Australia. It operates through Contesta Teleservicios SAU.

Talgo SA

Talgo is engaged in designing, manufacturing, repairing and maintaining the railway rolling stock, as well as the manufacturing, assembling, repairing and maintaining the engines, machinery and parts of the railway systems. Co. has an industrial presence in seven countries: Spain, Germany, Kazakhstan, Uzbekistan, Russia, Saudi Arabia and U.S.A. Co. has an active fleet in Europe, Asia and North America that comprises of 94 high-speed trains and more than 1,400 Talgo tilting passenger cars. Also, Co. purchases, redesigns, constructs, leases and sells all types of real estate.

Unicaja Banco S.A.

Unicaja Banco SA is a Spain-based financial institution (the Bank) engaged in the banking sector. The Bank offers services to individual and business customers. Its products and services range includes current and savings accounts, debit and credit cards, consumer and commercial loans, real estate credit, securities brokerage, funds management, leasing, factoring, pension plans, life and non-life insurance, international trade financing, money transfer, as well as treasury, among others. The Bank operates a number of branches in Spain and Morocco. The Bank is controlled by Fundacion Bancaria Unicaja.

Provider
Sabadell
Sabadell

Analysts
Research Department

Other Reports on these Companies
Other Reports from Sabadell

ResearchPool Subscriptions

Get the most out of your insights

Get in touch