ADP: Oddo remains neutral after decision on RIP
(CercleFinance.com) - Yesterday afternoon the Constitutional Council validated politicians' initiative to organise a shared initiative referendum (RIP) on the privatisation of the French airport operator, ADP, whose capital is controlled by the State.
Oddo says that at best privatisation has been delayed for several months (6 to 15 months?) and at worst, the process will be halted.
The Ministry of the Economy also announced that no privatisation decision would be taken during the RIP procedure. The broker adds that if the threshold of 4.7m voters is reached, then it is, in the broker's opinion, highly likely that the government does not even go until the organisation of the referendum. In the end, it cannot currently see how the government could continue ADP's privatisation process.
Logically, the price of ADP should return to the broker's fundamental (SOTP) valuation of 158 euros, even though it accepts that reaching the ambitious 2025 targets presented at the recent CMD (especially in terms of M&A) may offer slight additional potential.
Oddo confirms its neutral rating on the stock, with a target price of 181 euros: note that the share is down over 9% in morning trading in Paris on Friday.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
Oddo says that at best privatisation has been delayed for several months (6 to 15 months?) and at worst, the process will be halted.
The Ministry of the Economy also announced that no privatisation decision would be taken during the RIP procedure. The broker adds that if the threshold of 4.7m voters is reached, then it is, in the broker's opinion, highly likely that the government does not even go until the organisation of the referendum. In the end, it cannot currently see how the government could continue ADP's privatisation process.
Logically, the price of ADP should return to the broker's fundamental (SOTP) valuation of 158 euros, even though it accepts that reaching the ambitious 2025 targets presented at the recent CMD (especially in terms of M&A) may offer slight additional potential.
Oddo confirms its neutral rating on the stock, with a target price of 181 euros: note that the share is down over 9% in morning trading in Paris on Friday.
Copyright (c) 2019 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.