Alstom: Oddo maintains buy rating after results
(CercleFinance.com) - Alstom has reported net profit of 161 million euros, compared with 106 million euros expected.
Oddo says that it benefited from provision write-backs, although also incurred significant unusual charges (68 million euros for COVID, 44 million euros for the Bombardier Transport project).
The group had negative FCF of -253 million euros, albeit better than the consensus expected (-330 million euros).
FY 2020/21 revenues are expected at around 7.6-7.9 billion euros: Oddo's analysts' forecast is at the lower end of this range, with a target FY adjusted EBIT margin of 7.7%-8.0% (the broker currently expects 7.1%), which could exceed 8% in H2. Finally, FY FCF should be around 0 or could be positive, which is more optimistic than the previous guidance (around 0), Oddo adds.
H2 could therefore results in positive FCF of 250-300 million euros, or even slightly more. Alstom really seems to have returned to its profitable growth path.
Oddo maintains its buy rating on the stock with a target price of 55 euros (22% upside potential).
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.
Oddo says that it benefited from provision write-backs, although also incurred significant unusual charges (68 million euros for COVID, 44 million euros for the Bombardier Transport project).
The group had negative FCF of -253 million euros, albeit better than the consensus expected (-330 million euros).
FY 2020/21 revenues are expected at around 7.6-7.9 billion euros: Oddo's analysts' forecast is at the lower end of this range, with a target FY adjusted EBIT margin of 7.7%-8.0% (the broker currently expects 7.1%), which could exceed 8% in H2. Finally, FY FCF should be around 0 or could be positive, which is more optimistic than the previous guidance (around 0), Oddo adds.
H2 could therefore results in positive FCF of 250-300 million euros, or even slightly more. Alstom really seems to have returned to its profitable growth path.
Oddo maintains its buy rating on the stock with a target price of 55 euros (22% upside potential).
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.