Norilsk Nickel: Growth over dividends (downgraded to HOLD)
Norilsk Nickel held its 2019 Capital Markets Day (CMD) on 18 November. Medium-term capex guidance was increased meaningfully, which is likely to result in higher leverage in the medium term and lower dividend payouts, under the existing policy, from 2024E. Due mainly to higher capex, we lower our price target (PT) by 2%, to USD 28.1/GDR. We expect Norilsk to continue to pay c.11% dividend yields for the next few years. However, with nickel falling 18% since mid-September, the stock trading close to our PT and more capex than we expected on the horizon, we downgrade Norilsk from Buy to HOLD.
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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