KAZ Minerals: Results in line, guidance slightly conservative (stays BUY)
Last week’s results were above our EBITDA estimates and the consensus, while KAZ’s net debt fell 8% more than the consensus forecast due to VAT recovered and lower-than-guided capex. 2018E guidance was marginally worse than we expected, but we believe KAZ is being conservative and could beat these forecasts. We lower our 2018E numbers slightly to reflect management’s new guidance, but higher copper prices ytd negate this effect. As a result, our DCF-derived price target (PT) falls only 0.6% to GBp 996/share. In our view, KAZ appears too cheap at 5.7x 2018E EV/EBITDA, for a stock offering 40% copper production growth by 2022E, fully funded from its own cash flow. We remain BUYers of 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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