Engie: Credit Suisse a buyer before CMD
(CercleFinance.com) - Prior to the publication of Engie's annual results on 28 February, along with the group's CMD, Credit Suisse confirms its buy rating on the stock.
The broker has a target price of 16.1 euros for the share, which suggests upside potential of 14%.
Credit Suisse anticipates that, for 2018, the energy company will publish adjusted EBITDA that is down 1.9% at 9.1 billion euros, a figure that will slightly exceed the consensus (by 0.8%). However, analysts expect recurrent net income which, at 2.39 billion euros, will fall short of the target range provided by company management (2.45 billion to 2.65 billion euros). At 0.75 euros, Engie's dividend should be in line with expectations.
And then what? "In contrast, 2019 should show a very good y-y recovery as Belgian nuclear output 'normalises'," Credit Suisse predicts, expecting a 9% EPS growth in 2019, before a further increase of 10% in 2020. Engie's average annual EPS growth should therefore reach 9.7%, above that the rest of its sector (excluding services), which is expected to reach 7%.
In addition, after the group's 2016/2018 plan, its CMD will give Engie the opportunity to present its new strategic orientations. "We believe Engie needs to provide clear visibility on (a) where the company intends to be in 3 to 5 years," the broker states in its report, with it providing details of its earnings outlook.
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.
The broker has a target price of 16.1 euros for the share, which suggests upside potential of 14%.
Credit Suisse anticipates that, for 2018, the energy company will publish adjusted EBITDA that is down 1.9% at 9.1 billion euros, a figure that will slightly exceed the consensus (by 0.8%). However, analysts expect recurrent net income which, at 2.39 billion euros, will fall short of the target range provided by company management (2.45 billion to 2.65 billion euros). At 0.75 euros, Engie's dividend should be in line with expectations.
And then what? "In contrast, 2019 should show a very good y-y recovery as Belgian nuclear output 'normalises'," Credit Suisse predicts, expecting a 9% EPS growth in 2019, before a further increase of 10% in 2020. Engie's average annual EPS growth should therefore reach 9.7%, above that the rest of its sector (excluding services), which is expected to reach 7%.
In addition, after the group's 2016/2018 plan, its CMD will give Engie the opportunity to present its new strategic orientations. "We believe Engie needs to provide clear visibility on (a) where the company intends to be in 3 to 5 years," the broker states in its report, with it providing details of its earnings outlook.
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.