AmRest: discounted valuation call (upgraded to BUY)
We have upgraded AmRest to BUY, from Hold, with a new price target (PT) of PLN 28.1/share (from PLN 32.8). We believe that the deep restructuring, which has erased the growth element of the equity story, is coming to an end. At the same time, the stock dove c.60% during the early stages of the COVID-19 pandemic and failed to recover thereafter. Triggered by the pandemic and the war in Ukraine, AmRest has decided to dispose of 545 restaurants, about one-quarter of its store count at end-2019. However, as most of the cuts were applied to the underperforming operations, we see the overall quality of the asset base as improved. Therefore, expecting a 2022-25E revenue CAGR of a moderate 7%, we forecast a 9% CAGR in the EBITDA and as much as a 37% CAGR in the EBIT. Across that, we see our P/Es of 16.5x for 2023E and 9.5x for 2024E, 26% and 50% below its peers’ medians, as an attractive entry point.Amrest Holdings SE is a Spain-based company active in the restaurants and bars sector. The Company's core activity is operating Kentucky Fried Chicken (KFC), Pizza Hut, Burger King and Starbucks restaurants through its subsidiaries in Poland, the Czech Republic, Hungary, the Russian Federation, Serbia, Croatia, Bulgaria, Spain and France, on the basis of franchises granted, and Applebee's in the United States. Additionally, in Spain and France the Company operates its own brands La Tagiatella, Trastevere and il Pastificcio. It also operates PizzaPortal.pl, an online portal for ordering food from various restaurants. The Company operates through subsidiaries, such as AmRest Sp z o o, AmRest sro, AmRest doo, AmRest Adria doo, Blue Horizon Hospitality Group PTE, AmRest TAG SL, SC Marinopoulos Coffee Company III Srl and Marinopoulos Coffee Company Bulgaria EOOD, among others.
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.
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.