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IBERIAN DAILY 07 NOVEMBER + 3Q’24 RESULTS. HIGHLIGHTS AND REST OF PREVIEWS (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ACCIONA, ACCIONA ENERGÍA, AEDAS, AMADEUS, ARCELORMITTAL, INDRA, INMOBILIARIA COLONIAL, ROVI, TELEFÓNICA.

At the end of today’s report, and during the entire results season, we will include a presentation with positive and negative results highlights and previews for the 3Q’24 results to be released over the coming days in Spain.

European stock markets do not welcome Trump
European stock markets saw strong corrections, particularly the Ibex after D. Trump’s victory. On the contrary, US indices rallied, hitting new record highs. Thus, in the STOXX 600, most sectors ended with drops (15/20), led by Utilities and Autos vs. the bigger gains of Travel&Leisure and Media. On the macro side, in the euro zone, October’s final services PMI was raised. In Germany, the PM O. Scholz put an end to the government coalition, firing the Finance Minister C. Lindner. IN China, exports grew much more than expected in October. In US business results, Pinnacle y CVS came in below expectations.
What we expect for today
Stock markets would open with slight gains. Currently, S&P futures are up +0.21% (the S&P 500 ended +0.39% higher vs. the European closing bell). Asian markets are mixed (China’s CSI 300 +1.94%, Japan’s Nikkei -0.44%).
Today in the US the Fed will hold its meeting and we will also learn weekly jobless claims, in the euro zone September’s retail sales, in Spain and Germany September’s industrial output and in Mexico October’s inflation. In US business results, Ralph Lauren, Motorola, Expedia and Airbnb, among others, will release their earnings.



COMPANY NEWS

AEDAS HOMES. We cut our recommendation to UNDERWEIGHT following the good share price performance.
The 1H’24 results released are slightly below expectations but they are not representative of the entire year, which will be significantly biased on the last quarter. Sales: € 306 M (+33% vs. +26% BS(e) and +30% consensus); EBITDA: € 28 M (+56% vs. +63% BS(e) and +66% consensus). The company reiterated its 2024 guidance. Following the excellent share price performance in the past 2 years we no longer see appealing upside (+9%) and thus we cut our recommendation to UNDERWEIGHT despite the rollover of our model with a new T.P. of € 28.23/sh. (+8% vs. previous T.P.).

AMADEUS. 3Q’24 Results in line in sales but better in margin, with positive performance of bookings. OVERWEIGHT.
3Q’24 Results came in slightly below expectations in sales (+11.0% vs. +11.4% BS(e) and consensus), with the better performance of Airline Distribution (revenues grew +8.5% vs. 3Q’23), which offsets the worse performance of IT Solutions (+13.6% vs. 3Q’23). EBITDA was in line with our estimates but better than that expected by the consensus with a higher margin (+38.7% vs. 38.4% consensus). We stress that the performance of bookings (one of the investors highlights) came in above expectations (117 M vs. 115 M BS(e) consensus). These results, which underscore a good performance of margin and bookings, could lead to a positive reaction of the share price (-13% vs. IBEX in 2024).

ARCELORMITTAL. Better 3Q’24 results in EBITDA, with no relevant messages on the future. OVERWEIGHT
The 3Q’24 results beat expectations in EBITDA (-26.5% vs. -32.5% BS(e) and -30.8% consensus), although the business remains under pressure and is sequentially below Q2 (-15.1%) due to a lower EBITDA/t (US$ 118/t vs. US$ 133 in Q2) and the effect from the strike in Mexico. By regions, the price trend is negative in all of them, although it is more pronounced in the falling volumes. On the guidance level, the company suggests that apparent demand in 2H’24 should be better than in 2H’23 (affected by destocking) and believes the current price and demand situation is unsustainable. In short, the results are positive, although with no messages suggesting a real change in sector trends.

ROVI. Better 3Q’24 results. Guidance’25 announced, below expectations, and Risvan will not be launched in US. OVERWEIGHT
The 3Q’24 results beat expectations on the operating level (€ 97 M EBITDA vs. € 84 M BS(e) and consensus) thanks to the better performance in CDMO (sales +16% vs. +4% BS(e)). The company has announced that Risvan will not be marketed in the US due to the uncertainty surrounding the rollout, and the company has lowered peak sales to € 100-200 M (vs. € 200-300 M previously). ROVI maintains its guidance’24 of a mid-single-digit drop in operating revenues (vs. -1% BS(e) and -3.5% consensus) and announced a guidance’25 of a mid-single-digit drop in revenues, below expectations (+9% consensus). We expect a negative reaction, despite the fact that the company is usually conservative with its guidance and that it has shed -12% since the 1H’24 results (-13% vs. IBEX).

TELEFÓNICA, OVERWEIGHT
The 3Q’24 results came in slightly above expectations in sales (+0.1% vs. consensus) and in line in adjusted EBITDA compared to our numbers (+1% vs. consensus). On the positive side we highlight Brazil and Telefónica Deutschland (+3% and +1.9%, respectively, vs. expectations in EBITDA). On the domestic market the figures are basically in line. We highlight the very positive performance in FCF, which rose +89% to € 866 M, +73% above our estimate and +34% vs. consensus.
We expect a positive reaction today, as the results beat expectations with solid cash generation. The stock has risen +6% vs. the IBEX in 2024.