OMV: blocked stream, new theme (downgraded to HOLD)
We have downgraded our rating on OMV to HOLD (from Buy), with a revised price target (PT) of EUR 44.9 (from EUR 58.3), offering 0.3% upside. While higher oil and gas prices promise better results in upstream, betting big on Russia looks less inspired, with 2022 hindsight. Betting big on petrochemicals still looks good in the long term, but high oil prices tend to be inimical to good petchems margins, so 2022E looks less attractive to us. A shortage of diesel has boosted refining margins, but refineries with higher diesel yields are available elsewhere. Net zero plans have been fleshed out recently for all segments of the business and make sense, in our view, but positive outcomes could be some way off and at risk from market changes. Progressive dividends are one thing that we can recommend unequivocally, however, with yields above 5%, on our calculations. OMV trades at a P/E of 4.8x in 2022E, which rises to 6.5x in 2024E, on our estimates, while the peer group is at 6.0x for both years, on our estimates.OMV is an international energy company with activities in Exploration and Production (E&P), Refining and Marketing including petrochemicals (R&M), and Gas and Power (G&P). Co. explores and develops oil and gas resources and supply energy to over 100 million people. OMV has three operating segments: Exploration and Production (E&P), Refining and Marketing, including petrochemicals (R&M), and Gas and Power (G&P), as well as the segment Corporate and Other (Co&O).
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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