Getlink: Oddo BHF a buyer - raises target price sharply
(CercleFinance.com) - Brexit or not, the broker Oddo BHF has confirmed its buy rating on the share of the Channel Tunnel operator Getlink (formerly Eurotunnel).
Insisting on the share's currently speculative nature, the broker has also raised its target from 11.9 euros to 17 euros (+42.8%). This represents upside potential of over 20%.
Oddo BHF first highlights the group's optimistic financial forecasts, which suggest nearly 30% growth in EBITDA between 2018 and 2022. Subject to the completion of a “soft Brexit,” which is the broker's central scenario, it believes that this is credible, the broker's comments say, which is counting on a higher volume of truck shuttles, a rise in prices, and ultimately the commissioning of the ElecLink electrical interconnection.
In the worst-case scenario, i.e. the UK leaving the EU without a deal, the broker would have a target price of 12 euros for the share.
The broker then insists on the speculative interest of the Getlink share, saying that it believes that Atlantia's increased stake (15.5% of its capital and 26.7% of the voting rights) and that of Eiffage (5% and 4.3% of the voting rights) justify a speculative premium. According to Oddo BHF, these two shareholders do not intend to remain on the sidelines as minority shareholders, and that they could justify paying a price that is significantly higher than the current share price to fully buy out Getlink.
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.
Insisting on the share's currently speculative nature, the broker has also raised its target from 11.9 euros to 17 euros (+42.8%). This represents upside potential of over 20%.
Oddo BHF first highlights the group's optimistic financial forecasts, which suggest nearly 30% growth in EBITDA between 2018 and 2022. Subject to the completion of a “soft Brexit,” which is the broker's central scenario, it believes that this is credible, the broker's comments say, which is counting on a higher volume of truck shuttles, a rise in prices, and ultimately the commissioning of the ElecLink electrical interconnection.
In the worst-case scenario, i.e. the UK leaving the EU without a deal, the broker would have a target price of 12 euros for the share.
The broker then insists on the speculative interest of the Getlink share, saying that it believes that Atlantia's increased stake (15.5% of its capital and 26.7% of the voting rights) and that of Eiffage (5% and 4.3% of the voting rights) justify a speculative premium. According to Oddo BHF, these two shareholders do not intend to remain on the sidelines as minority shareholders, and that they could justify paying a price that is significantly higher than the current share price to fully buy out Getlink.
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.