Gazprom: Growing dividends, still undervalued (stays BUY)
We have increased our price target (PT) for Gazprom, to USD 9.7/GDR (from USD 6.1/GDR), as we incorporate our higher gas and oil price assumptions, a stronger commitment to dividends by management and the increased chances of Nord Stream 2 completion. On our estimates, Gazprom’s dividend could reach RUB 32/share in 2022E; and, together with the RUB 12.55 dividend announced this year, this represents a 17% yield (within just 14 months). Such a high dividend yield indicates that the market may view the recent gas price rally as unsustainable, or it might still have concerns about corporate governance and government regulation. We see such views as excessively cautious and we provide our arguments in more detail in this report. We maintain our BUY rating on the stock.
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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