IBERIAN DAILY 17 MAY + 1Q’21 RESULTS. PREVIEWS (ANÁLISIS BANCO SABADELL)
NEWS SUMMARY: CELLNEX, LAR ESPAÑA, MAPFRE, SIEMENS GAMESA, TELEFÓNICA.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 1Q’21 results to be released over the coming days in Spain.
MARKETS YESTERDAY AND TODAY
The Ibex saved a turbulent week for stock markets
European indices ended Friday’s session with gains >1.2% that softened losses in a week marked by inflation tensions, where the Ibex was the best-performing index in the euro zone. Calm returned to US markets that repeated Thursday’s gains despite worse-than-expected macroeconomic data. Thus, this week in the Euro STOXX, the best-performing sectors were Banks and Household Goods, whereas Technology and Travel & Leisure saw the biggest losses. On the macro side, in Spain, April’s final inflation remained at 2.2%, as expected. In the US, both retail sales and industrial output were disappointing in April, falling more than expected. In China, April’s retail sales and industrial output grew less than expected, whereas home prices increased by +4.8% annually vs. 4.6% previously. Lastly, the US and the EU might announce today a truce in their dispute over metal tariffs.
What we expect for today
The European stock markets would open with slight gains that would slow throughout the session. Currently, S&P futures are down -0.15% (the S&P 500 ended down -0.25% vs. its price at the closing bell in Europe). Volatility in the US fell (VIX 18.81). Asian markets are trading with mixed results (China’s CSI +1.5% and Japan’s Nikkei -0.9%).
Today in the US we will learn May’s Empire manufacturing index and NAHB home index. As for auctions, Germany will issue € 3 Bn in 6 & 12M T-bills and Holland € 2 Bn in 3 & 6M T-bills.
COMPANY NEWS
LAR ESPAÑA. We raise our T.P. following the 1Q’21 results. BUY.
The 1Q’21 results presented on Friday were weak, but we understand that 1Q should be the weakest quarter of the year (provided that the pandemic does not get worse), and although the stock has risen +79% since its 2020 lows, we believe that it still yields upside, and thus, with this set of results we raise our T.P. by +14% to € 6.94/sh. (+26.6% upside) after fine-tuning our assumptions on the reduction in the value of retail assets, which were too pessimistic until now, and rolling over our model. We reiterate our BUY recommendation.
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.
Lar Espana Real Estate SOCIMI SA is a Spain-based company primarily engaged in the operation of retail Real Estate Investment Trusts (REITs). The Company specializes in acquiring, managing and renting real estate assets within the Spanish market. Its business activities are divided into three segments: Shopping Centers, Offices, as well as Logistics. The Shopping Centers area is responsible for operation of a number of shopping malls, namely Txingudi, Las Huertas, Albacenter, Anec Blau, Hiper Albacenter, and Nuevo Alisal, among others. The Offices segment invests in office properties, such as Arturo Soria, Cardenal Marcelo Spinola, Egeo and Eloy Gonzalo. The Logistics division focuses on managing logistics warehouses, including Alovera I and Alovera II. The Company also owns a plot for residential properties development. It is a parent of a number of entities, such as Lar Espana Inversion Logistica SA, Gran Via Centrum Holdings SAU, Global Noctua and Puerta Maritima Ondara.
Mapfre is an insurance company based in Spain. Co. is the parent company of a group engaged in the underwriting and provision of insurance in Spain and abroad. Insurance policies provided include: life, non-life, accident, home-owner, general and health. Through its subsidiaries, Co. is also engaged in the provision of reinsurance, the management of investment funds, pension funds and pension plans, real estate and related services. On the domestic market, Co.'s activities include managing investment funds, pension funds and pension plans, real estate and other service businesses.
Telefonica is engaged in the provision of public or private telecommunications services, including ancillary or complementary telecommunications services or related services. Co.'s fixed business includes: traditional fixed telecommunication services, Internet and broadband multimedia services, data and business-aplications services, and wholesale services for telecommunication operators. Co. also provides a range of mobile and related services and products to consumer and business customers, including mobile voice services, value added services, mobile data and Internet services, wholesale services, corporate services, roaming, fixed wireless, and, trunking and paging.
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