Dassault Aviation: Oddo confirms buy rating
(CercleFinance.com) - Oddo says that yesterday evening Dassault Aviation published better-than-expected H1 2020 results, with an adjusted operating profit of 55 million eurs (Oddo BHF: 2 million euros, H1 2019: 250 million euros), thanks to sales that were finally more dynamic than expected at 2,641 million euros with the delivery of 7 Rafale Export and 16 Falcon (against 5 and 13 anticipated respectively).
Following this announcement, Oddo confirms its buy rating on the share with a target price of 1,050 euros (33% upside potential).
The broker notes that net cash amounted to 3.9 billion euros, down 664 million euros compared to 31/12/19, due to the use of advances on the Rafale export contract (293 million euros) and the increase in inventories and work-in-progress (191 million euros).
Although visibility of the Falcon business remains low, the broker says that its valuation is still impossible to justify. The share's current price implicitly values both these businesses at -100 mbillion euros, an amount obtained by deducting the stake in Thales (spot price without discount) from Dassault Aviation's capitalisation, and net cash, adjusted for excess prepayments, it adds.
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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.
Following this announcement, Oddo confirms its buy rating on the share with a target price of 1,050 euros (33% upside potential).
The broker notes that net cash amounted to 3.9 billion euros, down 664 million euros compared to 31/12/19, due to the use of advances on the Rafale export contract (293 million euros) and the increase in inventories and work-in-progress (191 million euros).
Although visibility of the Falcon business remains low, the broker says that its valuation is still impossible to justify. The share's current price implicitly values both these businesses at -100 mbillion euros, an amount obtained by deducting the stake in Thales (spot price without discount) from Dassault Aviation's capitalisation, and net cash, adjusted for excess prepayments, it adds.
Copyright (c) 2020 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.