Porsche: Credit Suisse still very upbeat on stock
(CercleFinance.com) - Credit Suisse still recommends investors buy ("outperform") the Porsche preference share, which analysts say remains their favourite vehicle to play Volkswagen.
This is particularly so as the stock is still trading at a big discount, with its yield expected to increase. The broker maintains its target price of 103 euros, which represents upside potential of over 50%.
Porsche receives the dividends from Volkswagen and pays them back to its shareholders, net of management fees. It has recently offered to raise its 2017 dividend from 1.01 euro to 1.76 euro (+74.3%).
According to Credit Suisse, Porsche's profit should stabilise from 2019 at around five billion euros, against 3.3 billion euros in 2017. As a result, analysts expect a 2018 dividend of 3.38 euros, followed by 4.93 euros in 2020, resulting in an attractive yield.
Finally, Porsche's current valuation, even taking into account legal risks estimated at 1 billion euros, presents a 41% discount relative to its restated net assets.
Copyright (c) 2018 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.
This is particularly so as the stock is still trading at a big discount, with its yield expected to increase. The broker maintains its target price of 103 euros, which represents upside potential of over 50%.
Porsche receives the dividends from Volkswagen and pays them back to its shareholders, net of management fees. It has recently offered to raise its 2017 dividend from 1.01 euro to 1.76 euro (+74.3%).
According to Credit Suisse, Porsche's profit should stabilise from 2019 at around five billion euros, against 3.3 billion euros in 2017. As a result, analysts expect a 2018 dividend of 3.38 euros, followed by 4.93 euros in 2020, resulting in an attractive yield.
Finally, Porsche's current valuation, even taking into account legal risks estimated at 1 billion euros, presents a 41% discount relative to its restated net assets.
Copyright (c) 2018 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.