Ferrovial: Heathrow, USA and 407-ETR are 85% of the Target Price and justify the current price

ferrovial

Morgan Stanley | The transformation of Spanish construction firm Ferrovial (FER) into a quasi North America pure play infrastructure is underway with the service sales and construction reduction plan.

We raise the valuation of roads in the United States to €8bn (11 euros per share). We also raise the valuation of the 407ETR for the increase in rates. The combination of the three key assets, Heathrow, USA and 407-ETR are 85% of the target price and justify the current price of 29 euros. The rest up to the target price comes from an increase in FCF in 2020-27e and possibilities of increase in dividend.

ferrovialms

 

Ferrovial, Overweight, Target Price from 24.41 to 34.40 euros.

About the Author

The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.