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IBERIAN DAILY 19 JULY + 2Q’23 RESULTS. HIGHLIGHTS AND REST OF PREVIEWS (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ACS, GLOBAL DOMINION, GRIFOLS, VIDRALA.

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 2Q’23 results to be released over the coming days in Spain.

The US earnings season kicked off to a good start
European stock markets saw an increasing performance, fuelled by the US earnings calendar, where the Ibex managed to erase the initial drops to remain at 9,400 points. Thus, in the Euro STOXX, Real Estate and Chemicals were the best performers whereas Telecoms and Consumer Goods ended with the biggest drops. On the macro side, in the US, June’s industrial output dropped more than expected after being cut last month. June’s retail sales rose less than expected and in line with expectations if we exclude the core components but the positive fact is that it was raised last month. Meanwhile, the confidence in the residential construction sector rose more than expected in July to highs from the past 13 months. In US results, Bank of New York, Morgan Stanley, Bank of America and Progologis came in better than expected.
What we expect for today
European stock markets would open with gains of as much as +0.2%, with the good performance of technology and banks.
Currently, S&P futures are down -0.10% (the S&P 500 ended +0.21% higher vs. the European closing bell). Volatility in the US dropped (VIX 13.30). Asian stock markets are mixed (China’s CSI 300 -0.43%, Japan’s Nikkei +0.82%).
Today in the euro zone and the UK we will learn June’s final inflation, in the US June’s construction licences and housing starts. In US 2Q’23 Results, Goldman Sachs, Neftlix, Tesla and US Bancorp, among others, will release their earnings. As for auctions, Germany will issue € 2.5 Bn in bonds due 2052 and 2053.


COMPANY NEWS

2Q’23 Results highlights and rest of previews
Of the stocks releasing their earnings over the coming days, on the negative side we highlight Ence (27/07), where we the results will reflect the impact from the latest RD on renewable energies that, although it is no surprise and has no impact on the valuation, will mean a restatement of 1Q’23 EBITDA (lower) and an -87% drop in 2Q’23 (vs. 2Q’22), which will mean the consensus will have to cut its estimates for the year, and this could weigh on the stock.

VIDRALA. Solid 2Q’23 results, slightly beating expectations. BUY.
The 2Q’23 results are strong thanks to the price increases made over the past 18 months along with the falling energy costs and improved efficiency. Sales: € 416.9 M (+12.1% vs. +16.9% BS(e)); EBITDA: € 114.5 M (+29.1% vs. +26.2% BS(e)). For all of the first half the company reached a record EBITDA level: € 215 M (+95% vs. average over the past 8 years). We have no details on volumes, but we expect them to have fallen slightly. The company reiterates its guidance for the full year: double-digit growth in sales (+16% BS(e)) with an EBITDA margin above 25% (25% BS(e)) and EPS +40% to € 7/sh. (€ 7.84/sh. BS(e)).