IBERIAN DAILY 26 NOVEMBER (ANÁLISIS BANCO SABADELL)
NEWS SUMMARY: ENDESA, FERROVIAL, INFRASTRUCTURES SECTOR, TELEFÓNICA.MARKETS YESTERDAY AND TODAY
A back-and-forth session for stock markets
It was a session of strong volatility, although stock markets managed to reel in most of the day’s losses towards the end of the session. Within the Euro STOXX, the best-performing sectors were Household Goods and Telecoms, whereas Autos and Energy saw the biggest losses, cooling the recovery of value stocks. On the macro level, the main US macro data came in above expectations (October’s durable goods orders, new home sales and real personal outlays). Lastly, the Fed minutes suggest that the Fed will implement adjustments to the asset purchase programmes from an extension to an increase in purchases in the long-term segment of the curve.
What we expect for today
European indices would open with slight gains, with the stagnated Brexit talks looming over the markets. Currently, S&P futures are up +0.05% (the S&P 500 closed practically flat vs. its price at the closing bell in Europe). Volatility in the US decreased (VIX 21.25). Asian markets are rising (CSI 300 +0.1%, Japan +0.9%).
Today we will learn in the Euro zone, October’s M3 data and the ECB minutes, and in Mexico the 3Q’20 GDP. In debt auctions: Italy (€ 6.5 Bn in 6M T-bills).
COMPANY NEWS
ENDESA. Maintains long-term targets but eases those for 2021-22. Positive surprise in the dividend’20. BUY.
From the strategic plan through 2023 we highlight: (i) A positive surprise in the 2020 dividend: € 1.90/sh. (7.8% yield, +11% vs. BS(e) and +18% vs. consensus). (ii) A moderate revision of its 2021-22 targets to propose 2023 levels in line with expectations. Our estimates are still -4% below those proposed by ELE (-1% consensus) in both EBITDA and Net Profit. We believe that following the negative reaction to the strategic plan, the market has already priced in this cut. We cut estimates slightly, raising our T.P. by +7% to € 28.04/sh. (+15% upside) after rolling over our model to include installed renewable capacity pipeline adjusted for risk totalling 5 Gw. If we were to assume 100% of ELE’s targets (€ 4.3 Bn EBITDA’23, -8% BS(e)), our T.P. would yield additional +9% upside.
Endesa is engaged in the production, transmission, distribution, and supply of electricity, through hydroelectric, fossil fuel, and nuclear generation. Co. is also engaged in the mining of coal for use in its fossil-fuel electric plants; mining research; land restoration, and environmental monitoring and control.
Ferrovial is a transportation company based in Spain. Co. is engaged in operations in the transportation sector. Co. specializes in the design, construction, management, administration and maintenance of transport infrastructures. Co.'s services range also includes the maintenance of parking lots, and land-, sea- and air-based transport networks. Co. is also engaged in the promotion and operation of short-stay parking lots, parking regulation and management services and promotion and sale of residents' parking.
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.