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IBERIAN DAILY 31 JANUARY + 4Q’22 RESULTS. HIGHLIGHTS AND PREVIEWS (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ELECTRICITY SECTOR, IAG, MEDIASET, UNICAJA.


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’22 results to be released over the coming days in Spain.

The Ibex ends flat above 9,000 points
The European stock markets posted slight losses at the beginning of a decisive week for central banks. Within the Euro STOXX, the best-performing sectors were Media and Food, whereas Technology and Energy saw the biggest drops. On the macro side, inflation climbed unexpectedly to 5.9% in January, with core inflation standing at 7.5%, whereas December’s retail sales recovered to 4.0%. In Germany, the 4Q’22 GDP contracted by -0.2% YoY vs. the stagnation expected. In the Euro zone, the economic confidence index recovered more than expected. In the US, the Dallas Fed manufacturing index improved in January, although it still stands in negative territory. In Japan, December’s industrial output contracted less than expected, whereas retail sales recovered above expectations. In China, December’s industrial earnings contracted at a slightly more significant pace but both the manufacturing and the services PMIs climbed more than expected in January, to 50.1 and 54.4 from 47 and 41.6 previously. Lastly, the IMF slightly raised its global growth forecast for 2023 to 2.9% from 2.7% previously (3.1% vs. 3.2% previously for 2024), raising significantly that for China, where it forecasts 5.2% growth vs. 4.3% previously, with the Euro zone and the US growing by 0.7% and 1.4% previously (vs. 0.5% and 1.0% previously).
What we expect for today
European stock markets would see drops of between -0.5% and -1.0% throughout the session. Currently, S&P futures are down -0.1% (the S&P 500 ended -0.64% lower vs. the European closing bell). Volatility in the US rose (VIX 19.94). Asian markets are sliding (China’s CSI 300 -0.95% and Japan’s Nikkei -0.4%).
Today we will learn in Germany the unemployment data, in the Euro zone and Mexico the 4Q’22 GDP, and in the US, the 4Q’22 cost of labour, the Chicago Fed PMI and the Conference Board consumer confidence for January, and November’s home prices. In US business results, Pfizer, Mc Donald’s and GM Exxon, among others, will release their earnings. In debt auctions: Italy (€ 6 Bn in bonds due 2025).


COMPANY NEWS

4Q’22 results highlights and rest of previews
Along with our daily report we include 4Q’22 results forecasts with all the previews for next week in Spain with our qualitative opinion and the expected impact on the market. Of the stocks releasing their results over the coming days we highlight on the positive side Rovi (21/02), where we expect sales growth (fuelled by the packaging activity for Moderna) up to +23% vs. 4Q’21. Thus, FY2022 sales would grow by +24% vs. +15%/+20% guidance, with the company hitting a record high quarterly EBITDA of € 89 M (+41% vs. 4Q’21).

MEDIASET ESPAÑA, BUY
The boards of directors of MFE and TLG signed yesterday their merger project, via a share swap, through the absorption of the latter by the Italian parent company (MFE). TL5 is valued at 7 MFE shares (class A) for each TL5 share, which at closing prices is equivalent to € 4.96/sh. (+48% upside). TLG shareholders who oppose the merger have a cash separation right of € 3.2687 (+2.5% upside), which is the 3-month weighted average. The transaction is subject to the favourable vote of their respective shareholders meetings (March) and all due regulatory approvals. Since MFE already holds 78% of TL5, it is almost certain that the deal will go through. While we believe that the valuation could be more generous (adjusted for cash and ProSieben the offer values TL5’s core business at