Gesconsult | Grupo Iberpapel Gestión (IBG) is one of the key players in the printing and writing paper market in Spain. We like Iberpapel because of its high level of vertical integration and its healthy financial situation. It generates a lot of cash and has no debt.
Cie Automotive, the Spanish company which specialises in producing components for the automobile sector, registered a 25.5% rise in net profit to 123 million euros in the nine months to September from a year earlier. Link Securities has calculated a new valuation for the company which at current prices offers a potential upside for CIE’s shares of over 7%.
Carax-Alphavalue | Amongst integrated oil companies, Repsol (Add, Spain) is one of the smallest with a €19bn market cap despite its latest acquisition (Talisman) doubling its size (production seen at 725kbpd by 2020 from 355kbpd in 2014).
José Benito de Vega | Gas Natural’s shares have been volatile in the last few months due to results which were worse than analysts’ consensus, coupled with a strategic plan which disappointed the market. But the stock price has recovered in the last two months and has outperformed the Ibex 35 index by 7.6% so far this year.
Barcelona-based on-line agency eDreams, is an investment opportunity, according to Bankinter analysts. They offer three reasons: it is trading at much cheaper multiples (more than half) than its peers. The range, applying reasonable multiples, is slightly higher than the current one but much lower than the sector. So it has significant potential.
Diego Salvador (Gesconsult) | N+1 is a financial institution focusing on two business areas: advising on mergers and acquisitions and the management of a venture capital firm. The company is developing a very successful franchise thanks to the purchase of “boutique” investment banks in the US, as well as in countries like Germany, Austria and Japan in the near future. We are confident that it can continue to expand their business inorganically with continued acquisitions in attractive countries like the US.
UBS | Santander updated the main targets of its 15-18E business plan. The new 11% Group ROTE18E figure (previous 13%) is largely aligned with our existing forecasts, to which we make modest changes.
UBS | The recent fixed income sell -off has seen the proportion of developed market sovereign bonds trading in negative yielding territory drop to 34%. This compares to 40% at the end of June. Still, 34% is more than twice the level observed at the end of 2015.
Deutsche Bank (DB)’s current share price (-41.2% in the year so far) is probably already discounting the stock’s serious uncertainties and weaknesses. But at the same time, there seems to be increasingly less negative sentiment towards banks in the EMU.
Alfonso de Gregorio (Gesconsult) | Europac is a company which is involved in all sectors related to the paper and packaging industry. It’s a highly cyclical company trading at a 10% discount versus the average for the sector, both in terms of PER and EV/EBITDA.