IBERIAN DAILY 08 NOVEMBER + 3Q’23 RESULTS. HIGHLIGHTS AND REST OF PREVIEWS (ANÁLISIS BANCO SABADELL)
NEWS SUMMARY: ACCIONA, ACCIONA ENERGÍA, ACS, CELLNEX, FLUIDRA, 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’23 results to be released over the coming days in Spain.
Stability at support levels
European stock markets ended flat thanks to the recovery seen at the end of the session after debt yields moderated. In the STOXX 600, Technology and Financial Services were the best performers whereas cyclical sectors linked to raw materials, such as Energy and Basic Resources, saw the biggest drops. On the macro side, in Spain, September’s industrial production slowed down slightly less than expected. In Portugal, the socialist PM A. Costa resigned due to corruption allegations. In the euro zone, the construction PMI fell again to 42.7 in October. On another note, the ECB supervisor, A. Enria, asked eurozone banks to be more conservative in their forecasts after assuming greater drops in real estate prices. In Brazil, the minutes from the BoB’s latest meeting show greater caution of some members in tackling inflation although still willing to continue cutting rates after the unanimous -50bps cut. In Japan, the BoJ governor warned that a change in the monetary policy could be feasible before real wages are in positive levels. In US 3Q’23 Results, Dr Horton and Water Corp beat expectations.
What we expect for today
European stock markets would open with losses of around -0.5%, conditioned by messages from different CBs of the need for bigger rate hikes (in the Fed, Bowman and Logan) or distancing the possibility of cuts (Kazaks, Lane and Nagel). Currently, S&P futures are down -0.13% (the S&P 500 ended unchanged vs. the European closing bell). Volatility in the US fell (VIX 14.81). Asian stock markets are sliding (China’s CSI 300 -0.49%, Japan’s Nikkei -0.33%).
Today in the euro zone we will learn September’s retail sales. In US business results, Walt Disney, Warner Bros and Ralph Lauren, among others, will release their earnings. In debt auctions, the US will issue US$ 40 Bn of 10Y bonds.
COMPANY NEWS
ROVI. 3Q’23 results beating expectations. Guidance’23 raised and guidance’24 announced with upward risks. BUY
The 3Q’23 results beat expectations on the operating level (€ 74 M of EBITDA vs. € 65 M BS(e) and € 64 M consensus), with margins performing better (34.6% vs. 31.6% BS(e) and 31.2% consensus), as well as sales (+10% vs. +6% consensus). ROVI has raised its guidance’23 to stable sales (vs. -13% BS(e) and -7% consensus) and has announced a guidance’24 of falling revenues in the mid-single-digit range, slightly below the consensus (-5.5% BS(e) and -3% consensus), but with upward risks due to potential new third-party manufacturing contracts and the approval of Risvan by the FDA. We expect a neutral/positive reception of these results, as the company is normally conservative with its guidance, and the stock has fallen -11% (-10% vs. IBEX) over the past month due to the 2024 forecasts from Pfizer and Moderna.
Acciona is the parent company of a construction group. Co. is engaged in general construction activities in the areas of civil engineering and buildings, including railways, marine and hydraulic works, motorways and airports, town planning, conduits, pavements, parking lots, and industrial and urban buildings. In addition, Co. is engaged in the provision of real estate services, the operation of parking lots, telecommunications, services, ecology and alternative means of energy. Co.'s operations are organized in six business divisions: Infrastructures, Real Estate, Energy, Water, Environmental & Urban Services and Logistic & Transport Services.
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.
Cellnex Telecom SA is a Spain-based company engaged in the wireless telecommunications (telecom) business. Its activities are divided into three segments: Broadcasting infrastructure, Telecom site rental, as well as Network services and other. The Broadcasting infrastructure division comprises distribution and transmission of television (TV) and frequency modulation (FM) radio signals, operation and maintenance (O&M) of radio broadcasting network, as well as over-the-top (OTT) radio services, among others. The Telecom site rental division provides access to wireless infrastructure, primarily through infrastructure hosting and telecom equipment co-location, mainly for mobile network operators and other wireless and broadband telecom network operators. The Network services and other division offers connectivity services for a variety of telecom operators and radio communication, among others. The Company also develops 5th generation mobile networks (5G) through Alticom BV.
Fluidra is engaged in the manufacture and commercialization of accessories and specific products for swimming pools, irrigation, and water treatment and purification systems.
Laboratorios Farmaceuticos Rovi is engaged in the sale of its own pharmaceutical products and the distribution of other products for which it holds licenses granted by other laboratories for specific periods, in accordance with the terms and conditions contained in the agreements entered into with said laboratories.
Telefonica is engaged in the provision of public or private telecommunications services, including ancillary or complementary telecommunications services or related services. Co.'s fixed business includes: traditional fixed telecommunication services, Internet and broadband multimedia services, data and business-aplications services, and wholesale services for telecommunication operators. Co. also provides a range of mobile and related services and products to consumer and business customers, including mobile voice services, value added services, mobile data and Internet services, wholesale services, corporate services, roaming, fixed wireless, and, trunking and paging.
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