EUR 100.00 For Business Accounts Only

IBERIAN DAILY 14 APRIL (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: AEDAS HOMES, FERROVIAL, IBERDROLA, VISCOFAN.

Equity markets remain strong
European stock markets welcomed the more dovish reading of the Fed minutes and ended another week with gains very close to highs from Nov’21. In the Euro STOXX, Consumer Goods and Retail led the gains, with Utilities and Household Goods ending with losses of more than -1%. On the macro side, in the UK February’s industrial output contracted slightly less than expected, while the previous data was raised. From the BoE, Andrew Bailey (governor) suggested it is likely that another rate hike will come in May. In Germany, March’s final inflation confirmed the preliminary figure. In Spain, housing purchases fell -13% and mortgages fell -24% through February due to the increased interest rates and inflation, as well as rising prices in some cities. In the euro zone, February’s industrial output rose more than expected, confirming some recovery for 2Q’23. In the US, weekly jobless claims rose once again, while March’s production prices fell unexpectedly, which continues to reduce inflationary pressures on the US economy.
What we expect for today
The European stock markets would open with gains, with the same tone as yesterday. Currently, S&P futures are down -0.05% (the S&P 500 ended +0.59% higher vs. the European closing bell). Volatility in the US fell (VIX 17.80). Asian markets are rising (China’s CSI 300 +0.44% and Japan’s Nikkei +1.1%).
Today in Spain we will learn March’s final inflation and in the US retail sales, industrial output (March), February’s business inventories and April’s U. Michigan consumer confidence index. In 1Q’23 US business results, JP Morgan, Citi and Wells Fargo, among others, will release their earnings.


COMPANY NEWS

VISCOFAN. Substitution of casings becomes paramount. New T.P. € 74/sh. (+9% vs. previous; +11% upside). BUY
Despite the stock’s outperformance since its low this year, the return of volatility to the market means VIS remains one of our picks: (i) counter-cyclical nature of the demand for its business; (ii) leading position within an oligopoly; (iii) only one-stop shop; (iv) comfortable financial position; and (v) geographical diversification. We raise our sales’23e estimate by around +12% (+11% vs. 2022) and raise EBITDA’23e by +2.4% (+7% vs. 2022), although we will continue to see shrinking margins (-0.7pp vs. 2022). For the rest of the years we keep our estimates unchanged (CAGR’22-26e of +6% in sales and around +10% in EBITDA).