EUR 200.00 For Business Accounts Only

SIEMENS GAMESA: 2020-23 STRATEGIC PLAN (ANÁLISIS BANCO SABADELL)

2020-23 Strategic Plan. We maintain our SELL recommendation.
The company yesterday presented its 2020-23 Strategic Plan with a long-term guidance (2023 and beyond) with growth rates above the market (+4% CAGR’19-25e in installed GW) and an 8-10% adjusted EBIT margin (in line with the previous plan; vs. 7.7% BS(e) and 8.4% consensus in 2023). However, the 2021 guidance is disappointing in margins (3%/5% vs. 6.5% BS(e) and 6.3% consensus), which along with its good recent performance (+68% vs. IBEX from the market highs seen in February), would justify yesterday’s poor reaction (SGRE slid -4.6%). Even assuming a reasonably optimistic scenario (+8% CAGR’19-24e and 9% EBIT margin in perpetuity vs. +3% and 8% currently, respectively), our T.P. would be < € 19.00/sh. (vs. € 12.54/sh. currently and vs. current trading levels of € 22.20/sh.), yielding negative upside, and thus we maintain our SELL recommendation and place our T.P. Under Revision.