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Siemens: Oddo confirms opinion before IPO

(CercleFinance.com) - Siemens will float 15% of Siemens Healthineers' capital on the market, as part of the IPO of its healthcare business, potentially raising up to 4.
6 billion euros. Oddo maintains its Neutral rating on the stock with a target price of 114 euros.

The group has announced that it wants to float the shares between 6 and 15 March by offering 150 million Healthineer shares: Oddo underlines that "The valuation is only 26 euros to 31 euros per share." Siemens AG should, therefore, recover raise between 3.90 billion and 4.65 billion euros in cash for this IPO (sale of shares without a capital increase).

The cash raised is also quite limited, which should reduce the group's debt (industrial net debt of 7.9 billion euros at the end of December 2017) or make "add-on" acquisitions, and Oddo does not believe that it will be used to make a cash payment to shareholders.

The share is trading at above average historical sector multiples, while operational performance is declining in 2018 and the Healthineers IPO will not offer any supplement in terms of value. Oddo hence remains in Neutral on the stock, with a target price of 114 euros.

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