On Tuesday, the Colombian government ordered an intervention in Electricaribe because there was a risk the company could discontinue its services. Electricaribe is an electricity distributor with 2.5 million clients on Colombia’s Caribbean Coast. Gas Natural owns 85%, while the remaining stake is in state hands.
Julius Baer Research | Bond yields in the US will likely consolidate thanks to the cap of yields in Europe, as the region is not the next eye of the storm, but the anchor for stability on global bond markets. In the short-and medium term, the ECB’s next move is more important than the Fed’s for bond investors globally.
The Spanish market’s attention was firmly on technology company Indra on Tuesday when it’s share price plummeted 12%. One reason for the slump was its nine months to September results, which hugely disappointed analysts and investors.
Spanish power company Iberdrola is involved in the electricity and gas generation and distribution businesses in the US. It also has 5.504MW of installed capacity in Mexico, mainly in combined gas cycles. This is one of the pillars of future growth for Iberdrola as it is constructing 4.000 MW to reach a 2020 target of 10.000 MW of installed capacity.
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).
Telefonica’s stock price held up much better than expected after the multinational announced it will cut its dividend this year and next. The shares finally closed down 1% after falling as much as 4% in the first few hours of the session. It seems that investors have understood that, on the one hand, it is the company’s best option for reducing debt; and, on the other, that the dividend yield is still very attractive.
The first thing that should be said about Ana Botin is that only a few weeks after taking over the reins of Santander in September 2014, she left no-one in doubt that she planned to put that house in order and take the bank’s problems seriously. After a wave of restructuring, including lay-offs and bank closures, things have turned nasty again for Santander in the first half of this year, with Brexit and Brazil key complications.
Banco Santander has delivered €4.606 BN in attributable profits for the first nine months of 2016, down 22.5% from the same period in 2015 due to the impact of extraordinary items announced in Q2 of this year and Q2 of 2015. Excluding extraordinary items and exchange rate movements, profits grew by 8% year on year to €4.975 BN.