IBERIAN DAILY 06 FEBRUARY + 4Q’24 RESULTS. PREVIEWS (ANÁLISIS BANCO SABADELL)
NEWS SUMMARY: ARCELORMITTAL, CELLNEX, MOTORWAY SECTOR, TALGO.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 4Q’24 results to be released over the coming days in Spain.
The Ibex continues to rally
Yesterday’s session was marked once more by D. Trump’s comments and his plan on Gaza amid fears about an increase in the geopolitical and commercial tension. Thus, in the STOXX 600, Pharma (after leading yesterday’s corrections) and Real Estate led gains vs. Autos and Chemicals that saw the biggest drops. On the macro side, in the euro zone, January’s final services PMI was cut by one tenth of a percent. In Spain, January’s services PMI dropped more than expected. In France, F. Bayrou survived the vote of no confidence and will be able to adopt the 2025 budgets. In the US, January’s non-manufacturing ISM fell more than expected (dragged down by new orders, activity and employment), with the price sub-index leading drops. January’s private ADP employment climbed more than expected to highs from the past 5 months. In Brazil, December’s industrial output rose, against expectations. In Japan, BoJ member N. Namura expects inflation to meet its target in 2H’25 and that the rate should be around 1.0% at that point. In US business results, Uber, Ford, Qualcomm and Walt Disney beat expectations.
What we expect for today
Stock markets would open with gains of around +0.5% with growth and bond proxies expected to fare well whereas debt yields continue to tighten. Currently, S&P futures are up +0.24% (the S&P 500 ended +0.26% higher vs. the European closing bell). Asian markets are climbing (China’s CSI 300 +0.87% and Japan’s Nikkei +0.68%).
Today in the euro zone we will learn December’s retail sales, in the UK and Mexico Central Bank meetings and in the US weekly jobless claims. In US business results, Amazon, Hilton, Philip Morris and Ralph Lauren, among others, will release their earnings.
COMPANY NEWS
MOTORWAY SECTOR. A sweet spot for the sector...
We see it as a sweet spot due to the environment of rate cuts, the strong dollar and the attractive pipeline of greenfield assets. We keep a positive stance towards SCYR (T.P. € 4.20/sh.; +32% upside) due to its growth potential (it will invest € 1 Bn of equity through 2027e) and the presence of drivers like the entry of a minority partner in Voreantis (€ 1.5-1.8 Bn). FER (T.P. € 46.50/sh.; +14% upside) is our top pick due to its higher sensitivity to interest rates, its heavy exposure to the US (~40% of T.P.) and better positioning for tendering of Managed Lanes.
ARCELORMITTAL. Better 4Q’24 results in EBITDA, with improved demand expected in 2025. OVERWEIGHT
The 4Q’24 results beat expectations in EBITDA (+13.8% vs. +8.0% BS(e) and +5.2% consensus), and although the business remains under pressure, the mining business offsets the lower price-cost spread in steel. With all this in mind, the figures are above those from 3Q’24 and 4Q’23, despite EBITDA/t being in line (US$ 122/t vs. US$ 118 in 3Q’24). By regions, the price dynamic is especially negative in Europe and North America. On the guidance level, the company expects demand to grow in 2025 (ex-China) at a pace of 2.5%/3.5%, with a smaller push in developed nations, and MTS believes restocking could boost growth above these levels.
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.
Talgo is engaged in designing, manufacturing, repairing and maintaining the railway rolling stock, as well as the manufacturing, assembling, repairing and maintaining the engines, machinery and parts of the railway systems. Co. has an industrial presence in seven countries: Spain, Germany, Kazakhstan, Uzbekistan, Russia, Saudi Arabia and U.S.A. Co. has an active fleet in Europe, Asia and North America that comprises of 94 high-speed trains and more than 1,400 Talgo tilting passenger cars. Also, Co. purchases, redesigns, constructs, leases and sells all types of real estate.
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