EUR 200.00 For Business Accounts Only

FERROVIAL: 2020-24 STRATEGIC PLAN (ANÁLISIS BANCO SABADELL)

From the presentation of the company’s 2020-24 Strategic Plan we highlight an annual EBITDA growth forecast of +11% (vs. +12.1% CAGR’20-24 BS(e); ~12% consensus through 2022), leveraged (this is the biggest news) on the implementation of a plan to reduce structure costs by €~50 M/year (~5% EBITDA annually) where FER is assuming EBIT margins of 3.5% in the Construction division (~23% of EBITDA’20/~2.9% margin BS(e)), but without a significant impact on the T.P., as it only has a weight of 3%.
Although the presentation of the 2020-24 Strategic Plan added nothing new, we maintain a positive stance on FER, where we see limited risks. A rate hike would be the main risk (+50bps would mean an impact higher than -5% on our valuation of ETR 407 and Heathrow). On the positive side, we expect better results, for which the sale of Services (11% of our T.P.) would be of paramount importance, and we see additional upside on valuations through the opening of new toll roads in the US (the company has extensive experience and resources to this end). We maintain our BUY recommendation.