Deutsche Bank | Our sector outlook recognises that the share price performance of Cellnex (and Italy’s INWIT) will depend on thematic consolidation in telecommunications in general. Although we remain confident in the short-term strength of MSAs, the market continues to seek reassurance despite examples in Spain and the UK of strengthened contracts. The slowdown in the company’s revenue growth has been a setback, but this is due to a high starting point of 9% to the current 6%, with an increasing focus on FCFE. BUY. Incremental data on coverage/MSAs, such as the fact that more than 80% of its French PoPs are subject to an all-or-nothing renewal, helps, but until they are tested in the context of an active merger or acquisition (announced deal), the market remains sceptical, even though MSAs in Spain and the UK remain strong following consolidation. It is important that MSA terms do not change, and we have seen Cellnex offer flexibility to customers while adhering to the robustness of MSA constraints.
Cellnex: share price performance to depend on sector consolidation
