Caixabank’s Chairman Isidre Fainé pointed out the “significant” fall of 12 points in the retail credit nonpayment. Performanced also marked by the reduction of provisions for financial assets deterioration (-66.7%). Bank of Spain stated 1Q14 GDP y-o-y growth was positive after 9 straight quarters in the red.
SANTANDER. Sabadell obtained €81.2M (+58.8%) in benefits in 1Q14. Consensus expected €95.7M and same term last year the bank got €51.1M. Santander believes the entity still suffers from some fundamental weaknesses like the asset quality and the high defaulting levels (13.6%).
LINK. Fitch foresees housing prices in Spain will continue to fall until 2015 by 40% from pre-crisis maximums. The excessive offer, the low confidence, together with Sareb and banks sales lie behind this decline. Regarding unemployment, Fitch finds it close to top levels and it would fall to 25.5% this year. Salaries cut prompted by labor reform and smaller amount of permanent workers will make it more difficult for people to pay their mortgages, the agency points out.
Sacyr strengthens its financial position by a capital increase of 36.2 million shares (7.79%). Also, 5-year convertible bonds will be issued worth up to €300M. SABADELL gives a positive assesment to the operation addressed at general corporate expansion. New shares could be sold by upper to target price levels. ACF expects a negative impact for the dilutive effect for stokeholders whereas in long-term approach they appreciate an opportunity to reduce debt by €511M, mark down its cost, lengthen the maturity and obtain liquidity to bolster upcoming performance. According to The Corner’s Spanish market site Consenso del Mercado, Sacyr and Campofrío are the most recommended listed companies with a €5.11 target price (today €4.72).
BANKINTER. Gradual sector recovery and economic boost will enhance Spanish Técnicas Reunidas performance in the upcoming years. The company accomplished competitive advantages, sound financial situation and international diversification. It is currently undervalued. Bankinter sets a €50.4 target price and declares the company could enjoy a 20% potential appreciation.
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