OMV Petrom: awaiting the special dividend (stays BUY)
OMV Petrom’s share price has enjoyed a good rally in the past few months, moving up 42% ytd (cum dividend) and 34% yoy. Following a dip in September 2022, triggered by the EC’s adoption of the solidarity tax, and another dip in December 2022, when the solidarity tax was transposed into local legislation, the stock resumed its growth trend. The uptrend was driven by: 1) the amendment of the solidarity tax, with the payable tax significantly lower than 60% of the difference between the realised 2022-23 EBT and the average EBT over 2018-21 multiplied by 1.2; 2) the confirmation of a special dividend; and 3) the positive final investment decision (FID) for Neptun. We have revised our forecasts, primarily to reflect the amended solidarity tax and, thus, a higher special dividend payable this year. On Neptun, we see no reason to alter our estimates significantly following the FID. We still see upside in the stock, but not as impressive after the recent rally. We set our new 12M price target (PT) at RON 0.654 (from RON 0.611), implying upside of 19%, and 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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