EUR 100.00 For Business Accounts Only

IBERIAN DAILY 20 JANUARY (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: CELLNEX, SIEMENS GAMESA.

Central Banks contribute to correction
Following the statements made by members of the Fed, yesterday it was ECB President Christine Lagarde’s turn, which along with the ECB meeting minutes question a halt to rate hikes after pointing out that inflation is still too high, contributing to a drop of around -1.8% on European markets. In the Euro STOXX, all the sectors except Travel & Leisure fell, with Retail and Technology showing the worst relative performance. On the macro side, the ECB December meeting minutes showed the difficulty in agreeing on raising rates only +50bps, where the hawks wished to continue raising rates aggressively to above 3%. In Spain, the IMF raised GDP’22 growth to 5.2% from the previous 4.6% and cut that of 2023 by -0.1% to 1.1% In the US, December’s building permits fell unexpectedly, and housing starts slowed less than expected. The Philadelphia Fed index for January recovered more than expected, although it remained in negative territory. In Japan, December’s inflation rose in line with expectations and the core figure reached a 41-year high. In China, the PBoC maintained the 1Y and 5Y reference rates unchanged. In US business results, Procter&Gamble and Northern Trust released disappointing earnings, Truist Financial was in line and Netflix released disappointing profits but with a rise in subscriptions.
What we expect for today
The European stock markets would open with gains of around +0.3%. Currently, S&P futures are up +0.22% (the S&P 500 ended unchanged vs. the European closing bell). Volatility in the US fell (VIX 20.52). Asian markets are rising (China’s CSI 300 +0.7% and Japan’s Nikkei +0.54%).
Today in Germany we will learn December’s production prices and in the US December’s second-hand home sales. In US Results State Street and Huntington, among others, will release their earnings. As for auctions, Spain will issue € 5.5 Bn in bonds due 2028, 2030 and 2040.


COMPANY NEWS

CELLNEX. American Tower and Brookfield would be studying a possible TOB on the Company. BUY.
According to the press (OK Diario), American Tower and Brookfield are studying the possibility of launching a takeover bid on CLNX in order to delist it from the stock exchange. Morgan Stanley would be acting as advisor to American Tower and Brookfield, whereas CLNX would be advised by Goldman Sachs. The news story also mentions that some of CLNX’ main shareholders, such as the Benetton family (8.5%), Criteria (4.8%) or GIP (7.0%), would be inclined to sell their shares. While this is still an unconfirmed rumour, we believe that the stock could see a positive reaction today, as we do not rule out the possibility that the transactions is being considered in view of its strategic sense (these rumours are not new, although this possibility has not been mentioned for some time, since at least 2017), and especially, after the stock has slid by -24% in the last 12 months (-46% since August’21 highs) and that it is currently trading at an EV/EBITDA’23 multiple of 15x vs. 20x for American Tower. Our T.P. yields +40% upside vs. the current share price.