WOOD Flash – Surgutneftegas: could be the best insurance policy in volatile markets
We reiterate our BUY rating on Surgutneftegas’ preferred shares and consider them the most attractive stock in a weak oil price environment. While there can be no certainty where the oil price will be for the rest of the year and what the RUB/USD rate will be at the year-end, chances are much higher now that oil will be lower than what we expected earlier this year, while the RUB will be weaker. Assuming a USD 35/bl average oil price and a RUB/USD rate of 75, we estimate a RUB 6.9/share dividend for the preferred shares, which translates into close to a 20% dividend yield.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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