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IBERIAN DAILY 13 APRIL (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ACCIONA, ACCIONA ENERGÍA.

Central Banks put the brakes on
European stock markets welcomed the US inflation data, although the messages in favour of new rate hikes ended up halting the gains. In the Euro STOXX, the best-performing sectors were Media and Real Estate, whereas Travel & Leisure and Basic Resources saw the biggest losses. On the macro side, from the ECB, Robert Holzmann defended a +50bps rate hike in May due to the outlook on inflation, leaving the door open to speeding up QT starting in July. In the US, March’s inflation fell slightly more than expected (to 5.0%), while the core component rose in line with expectations to 5.6%. The IMF reiterated that this level continues to be too high, pushing Central Banks to fight inflation. The Fed sent mixed messages, with M. Daly believing that more rate hikes may not be necessary, although he does not foresee a recession, whereas T. Barkin stated that there is work to do to tackle core inflation. The Fed meeting minutes sounded more dovish, with members’ opinions varying greatly (division between increasing rates by +50bps and holding them). However, most members admitted that the rate level they see as restrictive enough has fallen and that the next steps to take will depend on the macroeconomy, keeping some flexibility in place. The issue of reducing the balance sheet was not discussed, but there was mention of the risk of a moderate recession. In China, March’s exports rose sharply and unexpectedly, whereas imports slowed slightly more than expected, a sign the economy is reopening.
What we expect for today
The European stock markets would open with slight gains in view of the Fed’s hesitation to continue raising rates. Currently, S&P futures are up +0.1% (the S&P 500 ended -0.58% lower vs. the European closing bell). Volatility in the US fell (VIX 19.09). Asian markets are trading with mixed results (China’s CSI 300 -0.56% and Japan’s Nikkei +0.28%).
Today in the UK we will learn February’s industrial output, in Germany March’s final inflation, in the euro zone February’s industrial output and in the US weekly jobless claims and March’s production prices. In debt auctions: Italy (€ 9.5 Bn in bonds due 2026, 2030, 2037 and 2044) and Spain (bonds due 2026, 2033 and 2042, and I/L bons due 2033).


COMPANY NEWS

ACCIONA/ACCIONA ENERGÍA. An opportunity after the correction. BUY/BUY.
Following the FY2022 earnings release, we cut our estimates for installed capacity’25e to 18.9 GW (vs. 20 GW previously and ANE’s target), while taking a more positive stance on Infra (+47% in EBITDA’23e vs. previously), which (together with other factors) leads us to set a new T.P. of € 39.80/sh. for ANE (-4% vs. previously) and € 216.74/sh. for ANA (+6% vs. previously), which yield +15% and +22% upside, respectively, and thus, we maintain our BUY recommendation for ANE and upgrade that for ANA to BUY (from SELL, previously). Thus, the correction seen in both share prices from August’22 highs (-21% ANE and -15% ANA) provides a new opportunity to invest in both, which, due to their quality, are stocks to be taken into account in a well-diversified portfolio. In the last year, ANA has traded at a -10% discount on average vs. its theoretical value (based on the ANE and Nordex share prices). Since the discount is currently -7%, if we only look for exposure to renewables, we would invest directly through ANE.